Karl Marx

Fragment of the Original Text of ‘Zur Kritik der politischen Ökonomie’

(August–November 1858)

*

Grundrisse der Kritik der Politischen Ökonomie

The translations of foreign-language quotations inserted are taken for the most part from various volumes of the
Marx-Engels-Werke
(MEW), some also from Vol. 2 of Section II of the
Marx-Engels-Gesamtausgabe
(MEGA). A few passages we have translated ourselves.

On the footnotes:

In parentheses ()
: Marx’s own footnotes

In square brackets []
: notes by the editors of the Grundrisse

Numbers without an asterisk
: foreign-language quotations (original in the notes)

Numbers with an asterisk
: foreign-language expressions (translation in the notes)

HTML markup and translations: J.L.W. for the
Marxists’ Internet Archive
.

Chapter II.

Chapter III. Capital.

A. Production Process of Capital

[Fragment of the Original Text of ‘Zur Kritik der politischen Ökonomie’ – Part 2]

Karl Marx

‘Zur Kritik’ Original Text

||1a|
Invariable Value of Money

“As means of payment – money in itself – money is supposed to represent value as such; but in fact it is only an identical quantum of variable value”

Money as Money (World Coin, etc.)

Money is the negation of the medium of circulation as such, of coin. But at the same time it contains it negatively as its determination, in that it can constantly be reconverted into coin; positively as world coin, but as such it is indifferent to the form determination, and essentially commodity as such, omnipresent commodity, not locally determined. This indifference is now expressed, on the one hand, in the fact that it is money only as gold and silver, not as token, with the form of coin. Hence the façon
,
which the state gives to money in the coin, has no value, only its metallic content. As such universal commodity, as world coin, the return of gold and silver to the starting point, indeed the movement of circulation as such, is not necessary.
Example
: Asia and Europe. Hence the lament of the adherents of the mercantile system that the gold disappears among the heathens, does not flow back. (The entry of the world coin itself into circulation and rotation, gradually with the development of the world market itself, does not concern us here yet.)

Money is the negation of itself as mere realisation of the prices of commodities, in which the particular commodity always remains the essential. It becomes rather the price realised in itself (in it)

and as such the material representative of universal wealth.

Money is also negated in the determination in which it is only measure of exchange-values. For it is itself the adequate reality of exchange-value, and it is this in its metallic existence. The measure determination must here be posited on it itself. It is its own unit, and the measure of its value, the measure of it as wealth, as exchange-value, is the quantity of itself which it represents. The number of its own units of measure. As measure, the number of these units was indifferent; as means of circulation, its materiality, the matter of its unity, was indifferent; as money in this third determination, the number of itself as a specific material quantum (e.g. number of pounds) is essential. Its quality as universal wealth being presupposed, there is no longer any difference in it except the quantitative. It represents a greater or lesser amount of universal wealth, according to whether a specific measure of it is possessed in a larger or smaller number. If it is universal wealth, one is the richer the more one possesses of it, and the only correct process is the heaping up of it. In accordance with its concept, it stepped out of circulation. Now this withdrawal from circulation, the hoarding of it, appears as the essential object of the drive for enrichment and as the essential process of enrichment. In gold and silver I possess universal wealth in its solid form; the more of it I pile up, the more of universal wealth I appropriate. If gold and silver are universal wealth, then as specific quantities they represent it only to a specific degree, hence inadequately. The whole must always drive itself further beyond itself. This accumulation of gold and silver, which presents itself as the repeated withdrawal of them from circulation, is at the same time the securing of universal wealth against circulation, in which it is constantly lost in exchange for particular wealth, wealth that finally vanishes in consumption.

*

Apud Tragicos contraria sunt δίχη und χβρδος
1*

Form of Property

Property in alien labour mediated by property in one’s own labour.

Editor’s Notes

Here begins notebook B'. The cover bears the inscription B
1
and below it the following notes:

Aesthetic Property of Gold

... yet gold stands out,
like blazing fire at night,
amid proud wealth.
1

(Pindar[ius: Olympica 1, 1-2])

Foreign-Language Expressions

1*
In the tragedians, justice and the striving for gain are opposites

Foreign-Language Quotations

1
... ό δέ

Χρυσός αίθόμιενον πΰρ

"Ατε διαπρέπει νυ-

κτι μεγάνορος ε ξοχα πλοΰτου.

aurum vero

fulgens (ardens) ut ignis

quia* ardet in nocte,

eximie inter magnificas

divitias.

[Fragment of the Original Text of ‘Zur Kritik der politischen Ökonomie’ – Part 3]

Karl Marx

‘Zur Kritik’ Original Text

[2. Money as Means of Payment]

...| receives. All particularity of the relation between the two is extinguished (the relationship concerns only exchange-value as such: the universal product of social circulation), and likewise all political, patriarchal and other relations deriving from the particularity of the relationship. They confront each other as abstract social persons, who represent only exchange-value as such to one another. Money has become the sole nexus rerum between them, money sans phrase. The peasant no longer confronts the estate-owner as peasant with his rural product and his rural labour, but as money-owner; for through the sale, the immediate use-value is alienated, has assumed the indifferent form through the mediation of the social process. And on the other hand, the estate-owner stands in relation to him no longer as to the awkward individual producing in particular conditions of life, but as to someone whose product, the autonomous exchange-value, the universal equivalent, money, differs in no way from the product of anyone else. Thus the cosy appearance that enveloped the transaction in the earlier form disappears. The absolute monarchy, itself already the product of the development of bourgeois wealth to a stage incompatible with the old feudal relations, needs, in keeping with the uniform, universal power which it must be capable of exercising at every point of the periphery, the material lever of this power—the universal equivalent, wealth in its ever ready form, in which it is completely independent of particular local, natural and individual relations. It needs wealth in the form of money. A system of deliveries in kind and payments in kind, in keeping with their particular character, also gives their employment the character of particularity. It is only money that can be directly converted into any particular use-value. The absolute monarchy is therefore active in transforming money into the general means of payment. This can only be carried through by enforced circulation, which makes products circulate below their value. For it, the transformation of all

taxes into money taxes is a life question. Hence while at an earlier stage the transformation of payments into money payments appears as so many castings-off of personal relations of dependence, as victories of bourgeois society, which buys itself free of hindering fetters with ready money—a process which, on the other hand, appears from the romantic side as the substitution of hard and heartless money relations for the brightly coloured
bonds
of humanity—in the epoch of the rising absolute monarchy, on the contrary, whose financial art consists in the forcible transformation of commodities into money, money is attacked by the bourgeois economists themselves as the imaginary wealth to which natural wealth is forcibly sacrificed. Thus, while e.g. Petty, in money as the material of hoard formation, in fact only celebrates the universal energetic drive for enrichment of the youthful bourgeois society in England, Boisguillebert, under Louis XIV, denounces money as the universal curse, which causes the development of the real sources of production of wealth to dry up, and with whose dethronement alone the world of commodities, real wealth and the universal enjoyment of it can be reinstated in their good old right. He could not yet comprehend that the same black financial art which threw men and commodities into the alchemist’s retort in order to make gold, at the same time caused all the relations and illusions that obstructed the bourgeois mode of production to evaporate, leaving behind simple money relations, vulgar exchange-value relations as the precipitate.

“In the feudal time, cash payment was not the sole ... nexus between man and man. Not as buyer and seller alone, ... but in a many-sided way, as soldier and captain, ... as loyal subject and lord, etc., did the lower and the higher relate to each other. With the final triumph of money, a changed time began.” (Th.
Carlyle
. “
On Chartism
”. London 1840, p. 58.)

Money is “impersonal” property. In it, I can carry the universal social power and the universal social nexus, the social substance, about with me in my pocket. Money hands the social power over to the private person as a thing, and the private person, as such, exercises this power. The social nexus, the metabolism itself, appears in it as something entirely external, which stands in no individual relation to its possessor, and consequently the power he exercises appears as something entirely accidental, external to him.

Without anticipating further, so much is clear: time purchases receive an extraordinary extension with the credit system. In proportion as the credit system develops, hence the mode of production founded on exchange-value, the role which money plays as means of payment will gain in scope compared with the role it plays as means of circulation, as agent of purchase and sale. In countries with a developed modern mode of production, hence with a developed credit system, money in fact figures almost exclusively in retail trade and in the small trade between producers and consumers as coin, whereas in the sphere of large commercial transactions it appears almost exclusively in the form of the
general means of payment.
To the extent that payments are balanced, money appears as a vanishing form, a merely ideal, imaginary measure of the exchanged magnitudes of value. Its corporeal intervention is limited to settling the relatively insignificant balances
(1)
The development of money as general means of payment goes hand in hand with the development of a higher, mediated, reflexively self-contained circulation, already placed under social control, in which the exclusive importance it possesses on the basis of simple metallic circulation, e.g. in hoarding proper, is superseded. But if, owing to sudden credit shocks, the balancing of payments is interrupted in its flow, the mechanism of payments, then money is suddenly required as real general means of payment and the demand arises that wealth should exist in its entire extent twice over, once as commodity and once as money, so that these two modes of existence cover each other. In such moments of crises, money appears as the exclusive wealth, which manifests itself as such not, as in the monetary system, in a merely imaginary, but in the active depreciation of all real material wealth. Over against the world of commodities, value now exists only in its adequate exclusive form as money. The further development of this moment is not relevant here. What is relevant here, however, is that in moments of actual money crises a contradiction immanent in the development of money as general means of payment makes its appearance. It is not as measure that money is required in such crises, for as such its corporeal presence is a matter of indifference; nor is it as coin, for it does not figure as coin in payments; but it is as autonomous exchange-value, as a physically present universal equivalent, as the materialisation of abstract wealth, in short entirely in the form in which it is the object of hoarding proper, as money. Its development as general means of payment envelops the contradiction that, on the one hand, exchange-value has assumed forms independent of its existence as money, and, on the other hand, its existence as money is posited precisely as the definitive and sole adequate one.

With money as means of payment, as a result of the balancing of payments, their cancelling each other out as positive and negative magnitudes, it can appear as the merely ideal form of commodities, as is the case with it as measure, and as it functions in the fixing of prices. The collision arises from the fact that, contrary to the agreement, the general presumption of modern commerce, it must suddenly, as often as the mechanism of these balancings and the credit system upon which it partly rests is disrupted, be present in its real form and be presented.

The law that the mass of circulating money is determined by the total price of the circulating commodities is now supplemented: by the total price of the payments falling due in a given period, and the economy of the same.

We have seen that changes in the value of gold and silver do not affect their function as measure of values, as money of account. This change in value, on the contrary, becomes decisively important for money in its function as means of payment. What is to be paid is a definite quantity of gold or silver in which, at the time of concluding the contract, a definite value, i.e. a definite quantity of labour-time, was objectified. But gold and silver, like all other commodities, change their magnitude of value with the labour-time required for their production; they fall or rise as it falls or rises. It is therefore possible, since the realisation of the sale on the part of the buyer takes place only later in time than the alienation of the commodity sold, that the same quantities of gold or silver contain a different, larger or smaller value than at the time the contract was concluded. Their specific quality as money, namely always to be a realised and realisable universal equivalent, always to be exchangeable for all commodities in proportion to their own value, is retained by gold and silver independently of changes in their magnitude of value. This magnitude, however, is subject to the same fluctuations, in potential, as any other commodity. Whether the payment is thus delivered in a real equivalent, i.e. the value magnitude originally intended, depends on whether or not the labour-time required for the production of a given quantity of gold or silver has remained the same. The nature of money, as incarnated in a particular commodity, comes into collision here with its function as autonomous exchange-value. The great revolutions which, e.g. in the 16th and 17th centuries, were brought about in all economic relations by the fall in the value of the precious metals, or similarly, only on a smaller scale, in the ancient Roman republic, by the rise in the value of copper, in which the debts of the plebeians were contracted, between the time [of the first silver denarius 485 a.u.c] and the beginning of the second Punic war, are well known. An exposition of the influence of the rise or fall of the value of the precious metals, the material of money, on economic relations presupposes the development of these relations themselves, and thus cannot be given at this point.

So much is self-evident, that a fall in the value of the precious metals, i.e. of money, always favours the payer at the expense of the recipient of payment; a rise in their value, conversely.

The complete reification, externalisation of the social metabolism on the basis of exchange-values appears strikingly in the dependence of all social relations on the costs of production of metallic natural formations, which are utterly insignificant as instruments of production, as agents in the creation of wealth.

Author’s Footnotes

(1)
“To prove how little,” says Mr. Slater (of the firm Morrison, Dillon & Co., whose transactions are amongst the largest of the metropolis), “of real money enters into the operations of trade,” he gives an “analysis of a continuous course of commercial transactions, extending over several millions yearly, and which may be considered as a fair example of the general trade of the country. The proportions of receipts and payments are reduced to the scale of £1,000,000 only, during the year 1856, and are as under, viz.:

Receipts

Payments

In bankers’ drafts and bills of exchange, payable after date

533,596

Bills of exchange payable after date

302,674

In cheques of bankers, etc., payable on demand

357,715

Cheques on London bankers

663,672

In country banknotes

9,627

Bank-of-England notes

22,743

Bank-of-England notes

68,554

Gold

9,427

Gold

28,089

Silver and copper

1,484

Silver and copper

1,486

Post-office orders

933

£1,000,000

£1,000,000”

p. LXXI (Report from the Select Committee on the Bank acts etc., 1 July 1858)

Foreign-Language Quotations

¹
“To prove how little,” says Mr. Slater (of the firm of Morrison, Dillon & Co., ... whose transactions are amongst the largest of the metropolis), “of real money ... enters into the Operations of trade,” he gives an “analysis of a continuous course of commercial transactions, extending over several millions yearly, and which may be considered as a fair example of the general trade of the country. The proportions of receipts and payments are reduced to the scale of 1.000.000 £ only, during the year 1856, and are as under, viz.:

Receipts

Payments

In bankers’ drafts and bills of exchange, payable after date

533,596

Bills of exchange payable after date

302,674

In cheques of bankers etc. payable on demand

357,715

Cheques on London bankers

663,672

In country banknotes

9,627

B[ank]-o[f]-E[ngland]-notes

22,743

B[ank]-o[f]-E[ngland]-notes

68,554

Gold

9,427

Gold

28,089

Silver and copper

1,484

Silver and copper

1,486

Post-office orders

933

£1,000,000

£1,000,000”

p. LXXI (Report from the Select Committee on the Bank acts etc. 1 July 1858)

[Fragment of the original text of A Contribution to the Critique of Political Economy – Part 4]

Karl Marx

Original Text “A Contribution to the Critique…“

3) Money as international means of payment and purchase, as world coin

Money is the
universal commodity,
already in that it is the universal form which every particular commodity assumes ideally or really.

As hoard and general means of payment money becomes the universal medium of exchange of the world market; the universal commodity not only in concept, but in its mode of existence. The particular national form it receives in its function as coin is stripped off in its existence as money. As such it is cosmopolitan
(1)
. Since, through the intervention of gold and silver as the use-value of the need for enrichment, of abstract wealth independent of particular needs, a social metabolism can take place even when only one nation | has an immediate need for the use-values of the other, gold and silver become extraordinarily effective agents in the creation of the world market, in the extension of the social metabolism beyond all local, religious, political, racial differences. Already among the ancients state hoarding serves as a reserve fund principally for international means of payment, as a quickly available equivalent in

Failures of harvests and source of subsidy moneys in war. (Xenophon.) The great role played by American silver as a binding agent between America, from which it travels as a commodity to Europe, and from there is exported to Asia, particularly India, as a means of exchange, there for the most part settling down in the form of a hoard – this was the fact with the observation of which the scientific struggle over the monetary system began, leading to the struggle between the East India Company and the existing prohibition of the export of money in England (see Misselden). In so far as gold and silver serve in this international traffic as mere means of exchange, they do indeed perform the function of coin, but of coin whose stamp has been stripped off and which, whether it exists in the form of coin or in bullion form, is valued only according to its metallic weight, not only representing value but at the same time being it. That, in this determination as world coin, gold and silver by no means necessarily describe the circular movement, as they do as coin proper, but can continue to relate to one another one-sidedly, the one side as buyer, the other as seller – this is likewise one of the observations that forced themselves immediately in the childhood years of bourgeois society. Hence the extraordinarily important role that the discovery of new gold- and silver-producing countries plays in the history of the development of the world market, both in its breadth and in its depth; since the use-value that they produce is at once universal commodity, on the other hand the very possibility of it, because of its abstract nature, simultaneously imposes upon them the necessity of intercourse founded on exchange-value.

Just as within a given national sphere of bourgeois society the development of money as means of payment grows with the development of the relations of production in general, so does money in its determination as international means of payment. As in that narrower sphere, so in this more universal one, its significance, however, only emerges strikingly in times of disturbance of the mechanism of the settlement of payments. The development of money in this determination has since 1825 increased so much – this increase naturally keeps step with the extension and intensity of international intercourse – that the most important economists of the preceding epoch, Ricardo for example, still had no inkling of the extent to which ready money can be required as international means of payment for a nation such as England. While for exchange-value in the shape of every other commodity the particular need for the

particular use-value in which it is incarnated remains the precondition, for gold and silver as abstract wealth no such barrier exists. Like the noble man of whom the poet dreams, it pays with what it is, not with what it does. The possibility of functioning as means of purchase and means of payment is of course always latently preserved in it. As the resting, secured being of the universal equivalent, in which it is a hoard, it is in no country restricted by the need for it as means of circulation, by the extent to which it is required as means of circulation, nor in general by any need for its immediate use. Its own abstract and purely social use-value, which it derives from its function as means of circulation, itself appears again as a particular aspect of its use as the universal equivalent, the material of abstract wealth in general. Alongside its particular use-value as metal and therefore as raw material of manufactures – the totality of the various functions that it can alternately fulfil within the social metabolism, or in the performance of which it itself assumes different forms as coin, bar, etc., appears as just so many use-values of it, all of which dissolve into different forms in which it, as the abstract and hence adequate being of exchange-value as such, confronts its being in the particular commodity.

We have to grasp money here only in its abstract form-determinations. The laws which regulate the distribution of the precious metals on the world market presuppose the economic relations in their most concrete form, which here still lie before us. Likewise all circulation of money that it performs as capital, not as universal commodity or universal equivalent.

On the world market, money is always realised value. It is in its immediate materiality, as weight of precious metal, that it is magnitude of value. As coin, its use-value coincides with its use as mere means of circulation and can therefore be replaced by a mere symbol. As world coin it is in fact demonetised. The externality and autonomisation of the social relation in money vis-à-vis individuals in their individual relations emerges in gold and silver as the world coin (as coin money still has a national character). And what the first proclaimers of political economy in Italy celebrate is precisely this fine invention, which makes a general metabolism of society possible without individuals coming into contact with one another. (2) As coin, money has a national, local character. To serve as gold and silver, as international means of exchange, it must be melted down, or if it exists in coined form, this form is a matter of indifference and the coin is reduced purely to its weight.

In the most developed system of international exchange, gold and silver appear once again entirely in the form in which they already play a role in original barter. Gold and silver as means of exchange, like exchange itself, originally appear not within the narrow circle of a social community, but where it ceases, at its boundary, at the few points of its contact with foreign communities. It thus appears posited as the commodity as such, the universal commodity, which everywhere maintains its character as wealth. It counts equally in all places according to this form-determination. It is thus the material representative of general wealth. In the mercantile system, gold and silver therefore count as the measure of the power of the different communities. “As soon as the precious metals become the aim of trade, the universal equivalent for everything, they also become the measure of power among nations.”¹ Hence the mercantile system. (Steuart.)

The determination of money to serve as international means of exchange and means of payment is in fact no new determination added to that of money in general, universal equivalent – and therefore of being both hoard and means of payment. In the determination of the universal equivalent, the conceptual determination as universal commodity is contained, as which money is indeed first realised as world coin. It is first as international means of payment and means of exchange that gold and silver (as already mentioned) appear as money at all, and it is from this their appearance that their concept as universal commodity is abstracted. The national, political restriction that money formally receives as measure in general (by fixing the unit of measure and the subdivision of this unit) and which, in the coin, can also extend to the content to the extent that value tokens issued by the state replace the actual metal, are historically later than the form in which money appears as universal commodity, world coin. But why? Because here it appears in its concrete form as money at all. Being measure and being means of circulation are functions of it, in the fulfilment of which it first assumes particular forms of existence through the later autonomisation of those functions. Take 1) coin, it is originally

nothing but a definite weight portion of gold; the stamp is added as a guarantee, as denominator of the weight, and still changes nothing; the stamp, which the fashion – i.e., the indication of value –, the independent sign, symbol of it, becomes, through the mechanism of circulation itself, the substance instead of the form; here the intervention of the state enters, because such a token must be guaranteed by the independent power of society, the state. But it is in fact as money, as gold and silver, that money acts in circulation; to be coin is only a mere function of it. In this function it particularises itself and can sublimate itself into the pure value token, which as such requires legal and legally enforceable recognition. 2) Measure. The units of measure of money and their subdivisions are in fact originally merely the weight parts of it as metal; as money it possesses the same unit of measure as weight. It is only when, in the minted metal pieces corresponding to this division of weight, the nominal value tears itself away from the real value, that the division of measure of gold and silver as gold and silver tears itself away from their division of measure as money; and thus definite weight parts of metal receive their own names, to the extent that they count as measure of value, for this function. In world trade, gold and silver are now valued solely according to their weight – without regard to their stamp; i.e., abstraction is made from them as coin. It appears in international trade entirely in the form, or formlessness, in which it originally appears and, where it serves as means of exchange, it serves, as originally also in internal circulation, always simultaneously as counter-value, realised price, real equivalent. Where it thus serves as coin, as mere means of exchange, it simultaneously serves as valuable representative of value. Its other functions, however, are the same ones in which it serves as money in general, in the form of hoard (whether this is conceived as a stock of means of subsistence secured in substance for the future, or as wealth in general) or as a universal means of payment, independent of the immediate needs of the exchangers, and satisfying only their universal need, or even their needlessness. As resting adequate equivalent, which can be withheld from circulation because it is not an object of a particular need, money is a stock, a security of means of subsistence for the future in general: it is the form in which the man without needs possesses wealth, i.e., in which the surplus, the part of wealth not immediately required as use-value, is possessed, etc. It is just as much security for future

needs as it is the form of wealth that goes beyond neediness.

Thus, in fact, the form of money as international means of exchange and means of payment is no particular form of it, but only an application of it as money; the functions of it in which it most strikingly functions in its simple and at the same time concrete form as money, as unity of measure and means of circulation, and as neither the one nor the other. It is its most original form. It appears as particular only alongside the particularisation which it can assume in so-called internal circulation, as measure and coin. In this character, gold and silver play an important role in the creation of the world market. Thus the circulation of American silver from the West to the East, the metallic band between America and Europe on the one hand, between America and Asia, Europe and Asia on the other, since the beginning of the modern epoch... As world coin, money is essentially indifferent to its form as means of circulation, while its material is everything. It does not appear for the exchange of surpluses, but as the settlement of surpluses in the overall process of international exchange. The form here coincides directly with its function of being a commodity, as the commodity accessible everywhere, the universal commodity.

Whether money circulates coined or uncoined is a matter of indifference. The Mexican dollars, imperials of Russia, are merely the form of the product of the South American and Russian mines. The English sovereign likewise serves, because it pays no seigniorage. 
(Tooke.)

How do gold and silver stand in relation to their immediate producers, in the countries where they are the immediate product, the objectification of a particular mode of labour? In their hands it is produced directly as a commodity, i.e. as a use-value which has no use-value for its producer, but becomes such for him only through its alienation, by its being thrown into circulation. It can exist as a hoard in his hands only because it is not the product of circulation, not withdrawn from it, but has not yet entered it. It is directly exchangeable, in proportion to the labour-time contained in it, only with other commodities, alongside which it exists, however, as a *particular* commodity. On the other hand, however, since it simultaneously counts as the product of general labour, the personification of the same, which it is not as an immediate product, it places its producer in the privileged position that he appears at once as buyer, not as seller. In order to obtain it as money, he must alienate it as an immediate product, but at the same time he does not require the mediation which the producer of every other commodity needs. He is a seller even in the form of a buyer. The delusion that it is possible to pluck it directly from the earth or riverbeds, as universal wealth satisfying all needs as such, shows itself naively, for example, in the following anecdote: “In the year 760, a mass of poor people emigrated to wash the river gold-sand south of Prague, and three men were able to extract one mark (half a pound) of gold in a day. In consequence, the rush to the ‘gold diggings’ and the number of hands withdrawn from agriculture became so great that the next year the country was visited by famine.”[2]
(Abhandlung von dem Alterthum des böhmischen Bergwerks, von M.G. Körner, Schneeberg. 1758.)

Money transmitted as gold, in the form of silver can everywhere be re-minted into means of circulation.

“Money has the property of always being exchangeable for what it measures”[3] (Bosanquet.) “Money can always buy other commodities, whereas other commodities cannot always buy money.”[4] “Precious metals must be available in very considerable quantity for use, and be employed as the most suitable means for settling international balances”[5] (Tooke.) It was chiefly as international money that gold and silver, in the 16th century, in the childhood period of bourgeois society, captured the exclusive interest of states and of the nascent political economy. The specific role played by gold and silver in international trade has again become completely clear and been recognised by the economists once more since the great gold outflows and the crises of 1825, 1839, 1847, 1857. Here they are the absolute, exclusive international means of payment, as value existing for itself, the universal equivalent. Value must be transmitted in specie[1*], can be transmitted in no other form of merchandise[2*]. “Gold and silver … can … be transported to the desired location, and it can be relied upon that on their arrival they will realise almost exactly the required sum”… “Gold and silver possess an infinite advantage over all other kinds of commodities for such purposes owing to the circumstance that they are universally in use as money.”[6] (Fullarton therefore sees here that value is transmitted in gold and silver as money, not in commodities; that | this is a specific function of the same as money, and he is therefore wrong to say that they are transmitted as capital and thus already introducing inappropriate relations. Capital can also be transmitted in the form of rice etc., twist etc.) “Not in tea, coffee, sugar or indigo are debts, foreign or domestic, usually contractually payable, but in coin; and the transmission of money, either in the designated coin itself or in bullion which can be immediately converted into that coin through the mint or the market of the country to which it is sent, must always provide the sender with the safest, most immediate and most accurate means to achieve this purpose without risk of failure owing to lack of demand or fluctuation of price.”[7] (125, 126. Fullarton, loc. cit.) “Any other article” (where it depends on the particular use-value, which is not money) “can be in quantity or kind outside the ordinary demand of the country to which it is sent.”[8]
(Tooke, Th. An Enquiry into the Currency Principle etc., ed. London 1844, [p. 10].)

The reluctance of the economists to recognise money in this determination is a remnant of the old polemic against the monetary system.

Money as universal international means of purchase and payment is not a new determination of it. It is rather only the same money in a universality of appearance that corresponds to the universality of its concept; the most adequate mode of existence of money, in which it actually functions as the universal commodity.

According to the various functions that money performs, the same piece of money can change its place. It can be coin today, tomorrow money, i.e. resting equivalent, without changing its external form of existence. Gold and silver as the concrete existence of money are essentially distinguished thereby from the token of value, by which they can be represented in internal circulation: gold and silver coins can be melted down into bullion and thus obtain their indifferent form as against their local character as coin, or when converted from coin into money, they serve merely as metallic weight. They can thus become the raw material for luxury articles, or be heaped up as a hoard, or travel abroad as international means of payment, where they are again capable of being converted into the form of the national coin, into any national coin. They retain their value in each of these forms. With the token of value this does not occur. It is only a token where it counts as such, and only counts as such where state power stands behind it. It is therefore confined to circulation and cannot fall back into the indifferent form, in which it is always value itself, and in which it can potentially assume any national stamp, or, indifferent to it, serve in its immediate mode of existence as means of exchange and material of hoard formation, or be converted into a commodity. It is confined to none of these forms, but assumes each of them as required by the need or tendency of the process of circulation. Above all, insofar as it is not worked up as a particular commodity in luxury articles, it is in relation to circulation, but not only the internal, but the world circulation, yet at the same time always in a self-sufficient form against absorption by the same. The coin, isolated as such, i.e. as mere token of value, exists only through and in circulation. Even when accumulated, it can only be accumulated as coin, since its power ceases at the frontiers of the country. Apart from the forms of hoard formation which emerge from the process of circulation itself and are really only resting points of it, namely as a stock of coin destined for circulation, or as a reserve for payments to be made in the national coin itself, there can be no talk here of hoard formation in general, hence not of hoard formation proper, since the token of value, as coin, lacks the essential element of hoard formation: being wealth independent of the particular social connection, because it is the immediate existence of value itself outside its social function, not merely symbolic value. The laws, therefore, which condition the token of value so that it may be such a token, do not condition metallic money, since it is not confined to the function of coin.

It is further clear that hoard formation, i.e. the withdrawal of money from circulation and its collection at certain points, is manifold: temporary accumulation which arises from the mere fact of the separation of purchase and sale, i.e. from the immediate mechanism of simple circulation itself; accumulation arising from the function of money as means of payment; finally, hoard formation proper, which wishes to hold fast and preserve it as abstract wealth, or also merely as an excess of existing wealth over immediate need and as a guarantee for the future or as a means of making involuntary stagnation of circulation more difficult. The latter forms, in which | the autonomization, the adequate existence of exchange-value, is still seen only in its immediately material form as gold, disappear more and more in bourgeois society. The modern forms of hoard formation, which emerge from the mechanism of circulation itself and are conditions for the fulfilment of its functions, on the other hand, gain greater development; although they assume various forms, which are to be considered in the banking system. On the basis of simple metallic circulation, however, it is evident that the

the various determinations in which money functions, or that the process of circulation, of the social metabolism, precipitates bar gold and silver in so many different forms as a quiescent hoard; that, however, although the part of money which exists as such hoard constantly changes its elements, and upon the whole surface of society a constant change takes place between the portions of money that perform this or that function, passing from the hoards into circulation, national or international, or being absorbed from circulation into the hoard reservoirs or transformed into articles of luxury, the function of money as medium of circulation is never restricted by these precipitations. Export or import of money alternately empties or fills these different reservoirs, as does the rise or fall of aggregate prices in internal circulation, without the mass required for circulation itself being driven above its measure by an excess of gold and silver, or falling below its measure. What is not required as medium of circulation is expelled as hoard; just as the hoard, as soon as required, is absorbed in the circulation. Among peoples with purely metallic circulation, hoard formation therefore also appears in the various forms from the individual up to the state, which guards its state hoard. In bourgeois society this process is reduced to the requirements of the total production process, and assumes other forms. It appears as a particular business, required by the division of labour in the total process of production, which in more naive conditions was carried on partly as the business of all private individuals, partly as state business. Yet the foundation remains the same, money continues to function in the various developed functions and even in the purely illusory one. This consideration of purely metallic circulation is all the more important, as all the speculations of economists about higher, more mediated forms of circulation depend on the observation of simple metallic circulation. It is to be understood 1) that when we speak of increase or decrease of gold and silver, it is always presupposed that their value remains the same, i.e. that the labour time required for their production has not changed. The fall or rise of their magnitude of value as a result of the fall or rise of the labour time required for their production presents absolutely no peculiarity distinguishing them from other commodities, however much it may impair their function as means of payment. 2) The motives which, apart from the falling and rising of prices, and the necessity of buying commodities from those who need no counterpart commodity (as in times of famine, war subsidies), open the hoards and fill them up again, hence the operation of the rate of interest cannot be considered here, where money is still only considered as money, not as form of capital. The mass of gold and silver located in a country must and will therefore, on the basis of simple metallic circulation and of general trade resting on ready money, always be greater than the mass of gold and silver circulating as coin, although the ratio between the portion of money which functions as money and that which functions as coin will change in quantity, and the same piece of money can alternately perform one function or the other, just as the portions serving national and international circulation will alternate in quantity, and replace each other in quality. But the mass of gold and silver is a constant reservoir, a drain-out channel as well as a feed-in channel, the latter naturally because it is the former, for both circulation currents.

*

As exchange-value, every commodity, however indivisible its use-value may be, as e.g. that of a house, is arbitrarily divisible. In its price it exists as such divisible exchange-value: i.e. as value estimated in money. It can thus be alienated arbitrarily, piece by piece, for money, although immovable and indivisible, the commodity can be thrown into circulation in parcels, by means of title deeds to fractions of it. Money thus acts as a dissolving agent on immovable, indivisible property. “Money means to cut up property into innumerable fragments and to consume it piece by piece through exchange.” (Bray.) Without money a mass of unexchangeable, inalienable objects, because they first obtain through money an existence independent of the nature of their use-value and of the relations of the same. “As immovable and unchangeable things, however, things movable and made for exchange, money came into use as rule and as measure (square), whereby these things acquired estimation and value.” (Freetrade, London. 1622.) “The introduction of money, which buys all things … brings the necessity of legal alienation.”9 (sc. of feudal estates3*). (124, John Dalrymple. An Essay towards a general history of feudal Property in Great Britain. 4. ed. London 1759.)

In fact, all the determinations in which money appears, as measure of value, medium of circulation, and money as such, express only the different relations in which individuals participate in total production or relate to their own production as social. These relations of individuals to one another, however, appear as social relations of things.

*

“The Cortes of 1593 made the following representation to Philip II: ‘The Cortes of Valladolid in the year ’48 beseech Your Majesty most earnestly no longer to permit the importation into the kingdom of candles, glasses, jewellery, knives and other such things, which come here from abroad, in order to exchange these wares, useless for human life, for gold, as if the Spaniards were Indians.’”10 (Sempéré.) “All of them hide and bury their money very secretly and very deep, especially the non-Mohammedan heathens, who have almost all trade and all money in hand, caught as they are in the belief that the gold and silver which they hide during their lifetime will serve them after death.”11 (p. 312–314 François Bernier, tome I. Voyages contenant la description des etats du Grand Mogol etc. Paris 1830). (At the court of Aurangzeb.)

“These have one common plan, and they deliver their power and might to the beast. [And it causes] that no one can buy or sell who does not have the mark or the name of the beast or the number of his name.”12 (Apocalypse. Vulgate.)

“The great and final effect of trade is not wealth in general, but pre-eminently abundance of silver and gold ..., which are not perishable, nor so changeable as other commodities, but wealth at all times and in all places.” (Their imperishability thus consists not only in the imperishability of their material, but in that they always remain wealth, i.e. always persist in the form determination of exchange-value.) “Abundance of wine, corn, poultry, meat etc., are riches, but hic et nunc4*” (dependent on their particular use-value). “So the production of such commodities, or the exercise of such trade, as supplies a country with gold and silver, is therefore advantageous above all others.” (Petty. Political Arithmetick. Lond[on] 1699, p. [178, 1]79.) “Gold and silver alone are not perishable” (never cease to be exchange-value), “but are esteemed as wealth at all times and in all places” [[The utility of particular use-values is temporally and locally determined, like the needs themselves which they satisfy]] “; all else is wealth only pro hic et nunc5*.” (l. c. p. 196.) “The wealth of every nation consists chiefly in its share of the foreign trade with the world market (the whole commercial world), rather than in the domestic trade6*, much more so than in the home trade in victuals, drinks and clothes, which bring in little gold and silver, universal wealth (universal wealth).” (p. 242.) As gold and silver are in themselves the universal wealth, so their possession also appears as the product of world circulation, first of that limited by immediate natural-ethical connections.

It might be striking that Petty, who calls the earth the mother and labour the father of wealth, who teaches the division of labour, and generally keeps his eye on the production process instead of the single product in a bold, genial manner, nevertheless seems here to be quite caught in the language and mode of conception of the monetary system. But it must not be forgotten that according to his presupposition, as according to the bourgeois presupposition in general, gold and silver are only the adequate form of the equivalent, which is always to be appropriated only through the alienation of commodities, hence through labour. Carrying on production for the sake of production, i.e. developing the productive powers of wealth without regard to the barriers of immediate need or enjoyment, expresses itself in Petty thus: producing and exchanging not for the sake of perishable enjoyments, into which all commodities dissolve, but for the sake of gold and silver. It is the energetic, ruthless, universal drive for enrichment of the English nation in the 17th century that Petty here at once gives expression to and spurs on.

Firstly the inversion of money: from means it becomes end and degrades the other commodities:

“The natural matter of trade is the commodity (Merchandize) ... The artificial matter of trade is money ... Although it follows upon the commodity in nature and time, yet, as it is now in use (in its present application), it has become the chief (Chef).” So Misselden, a London merchant, in his tract “Free Trade or the Means to make Trade florish.” London 1622. (p. 7.) He compares the change of rank between money and commodity to the fate of the two sons of old Jacob, who placed his right hand upon the younger and his left upon the elder son. (l. c.)

The antithesis between money as hoard and the commodities whose exchange-value passes away in the fulfilment of their purpose(3) as use-values: “The general remote cause of our lack of money is the great excess of this kingdom in the consumption of the commodities of foreign countries, which acquire for us only commodities7* in the shape of discommodities8*, cutting us off from just so much treasure (treasure) as would otherwise be imported in the place of these toys. … We consume among ourselves too great an abundance of wines from Spain, France, the Rhine, the Levant; the raisins of Spain, the currants of the Levant, the lawnes” (sort of fine linen) “and Cambricks” (other sorts ejusdem) “from Hainaut and the Netherlands, the silk fabrics of Italy, sugar and tobacco from the West Indies, the spices from the East Indies, all of which are no absolute necessity for us and yet they are bought with hard cash … Already old Cato said: Patrem familias vendacem, non emacem esse [oportet]9*.” (l. c. p. 11–13.) “The more the stock in commodities grows, the more does that which exists as hoard (in treasure) decrease.” (p. 23.)

On the non-returning circulation on the world market, specifically in trade with Asia:

“Money is diminished by trade beyond Christendom, with Turkey, Persia and East India. These branches of trade are conducted largely in ready cash, but in a different manner from the branches of trade within Christendom itself. For although the trade within Christendom is carried on with ready cash, the money nevertheless remains constantly enclosed within the boundaries of Christendom. There is in fact a flow and counter-flow, a flux and reflux of money in the trade carried on within Christendom: for sometimes it is more plentiful in one part and scarcer in another, according as one country experiences scarcity and another abundance: it comes and goes and swirls round the circle of Christendom, but remains always embraced by its line. But the money with which trade is carried on outside Christendom, to the countries mentioned above, is constantly spent (issued) and never returns.” (l.c. 19, 20.)

In a similar way to Misselden, the oldest German economist, Dr. Martin Luther, laments: “It cannot be denied that buying and selling is a necessary thing, which one cannot do without and can use in a Christian manner, especially in things that serve necessity and honour. For thus also the patriarchs bought and sold: cattle, wool, corn, butter, milk, and other goods. They are God’s gifts, which He gives from the earth and distributes among men. But foreign trade, which brings from Calicut | and India and the like wares, such as costly silks and gold work and spices, which serve only for pomp and no utility, and sucks the money out of the land and people, should not be allowed, if we had a government and princes. But of this I will not now write; for I think that in the end, when we have no more money, it must cease of itself, like finery and gluttony: in any case no writing or teaching helps, until want and poverty force us. God has hurled us Germans to such a pass that we must thrust our gold and silver into foreign lands, make all the world rich, and ourselves remain beggars. England would surely have less gold, if Germany left it its cloth: and the King of Portugal would also have less, if we left him the spices. Reckon you how much money is carried out of German land at one Frankfurt Fair without need or cause: and you will wonder how it comes about that there is still a heller in German lands. Frankfurt is the silver-and-gold hole through which flows out of German land whatever wells up and grows, minted or struck amongst us: were the hole stopped up, one would not now hear the complaint, how everywhere there is nothing but debt and no money, all the lands and towns [burdened with interest and] drained by usury. But let it be; it will go thus: we Germans must remain Germans: we do not stop, we must.” (Bücher vom Kaufhandel und Wucher, 1524.)

Boisguillebert, who occupies exactly the same significant position in French economics as Petty does in English, one of the most passionate opponents of the monetary system, attacks money in the various forms in which it appears as exclusive value vis-à-vis other commodities, as means of payment (with him particularly in the taxes) and as hoard. (The specific existence of value in money appears as relative valuelessness, the degradation of the other commodities.)

The cited writings of Boisguillebert, all from the edition of his collected works in the edition by Eugène Daire: “Economistes financiers du 18ième siècle. I vol. Paris 1843”.

“Since gold and money are not in themselves wealth and never were, but have only a relative value, and since in procuring the necessities of life they serve only as guarantee and measure of value, it is a matter of indifference whether one has more or less of them, provided they can achieve the same effect.”^13 (ch. VII, Première partie. “Le Détail de la France.” 1697.) The quantity of money affects the national wealth “only in so far as enough must be at hand to maintain the prices of the commodities necessary for life.”^14 (l.c. partie II, ch. XVIII, p. 209.) (Boisguillebert here thus enunciates the law that the mass of the circulating medium is determined by prices, and not vice versa.) That money is merely the form of the commodity itself becomes apparent in wholesale trade, where exchange takes place without the intervention of money, after the “commodities have been appraised”^15; “money is only the means and the motive force, whilst the commodities useful for life are the goal and the purpose”^16. (l.c. p. 210.) Money should only be means of circulation, always mobile; it should never become a hoard, an immeuble: it should be “in a constant movement, which it can only be as long as it is mobile, but as soon as it becomes immobile, all is lost”^17. (l.c. partie II, ch. XIX, p. 213.) In contrast to the finance, for which money appeared as the sole object: “the art of finance is nothing but the deepened knowledge of the interests of agriculture and trade”^18, (p. 241, l.c. partie III, ch. VIII.) Boisguillebert in fact looks only to the material content of wealth, enjoyment, use-value: “The true wealth … is the perfect enjoyment not only of the necessities of life, but also of superfluity and all that can give pleasure to the senses”^19. (p. 403. Dissertation sur la nature des richesses, de l’argent et des tributs.)

“One has made an idol of these metals” (gold and silver) “and, abandoning the end and intention for which they were summoned into trade, namely to serve as a pledge in exchange and mutual | transfer, one has almost exempted them from this service to make them divinities, to whom more goods and important necessities and even men have been sacrificed, and are still being sacrificed, than ever blind antiquity sacrificed to its false gods.”^20 (l.c. p. 395.) “The misery of the peoples comes only from having made a master, or rather a tyrant, of that which was a slave.”^21 (l.c.) One must break this “usurpation” and “restore things to their natural condition”^22. (l.c.) With the abstract craving for enrichment, “the equivalence which it” (money) “ought to have with other commodities, in order to mediate their exchange at any time, has suffered greatly”^23. (p. 399,) “The slave of trade has become its master… The ease with which money can serve all crimes redoubles its significance in proportion as corruption seizes the hearts; and it is certain that almost all villainies would be banished from a state if one could do the same with the fateful metal.”^24 (399.) The depreciation of the commodities, in order to convert them into money (to sell them below their value), is the cause of all misery. (See ch. V. l.c.) And in this sense he says: “Money has become the executioner of all things.”^25 (p. 413 l.c.) He compares the financial arts for making money to the “retort in which a terrifying amount of goods and commodities has been vaporised to obtain this baleful extract [which belongs to the master]”^26. (p. 419.) Through the depreciation of the precious metals “the commodities themselves will regain their natural value”^27. (p. 422 l.c.) “Money declares war on the whole human race”^28. (p. 417) l.c. (Likewise Pliny. Historia Naturalis, l. XXXIII, caput II, sectio 14.)

In contrast:

Money as world coin: “The communication of peoples with one another is so widespread over the entire globe that one may almost believe the whole world has become a single city, in which wares are continually offered and where every man from his abode can, by means of money, procure and thereafter consume all that the soil, the animals and human industry produce elsewhere. What a wonderful invention!”^29 (p. 40. Montanari (Geminiano). Della Moneta; written about 1683. In Custodi’s collection. Parte Antica. Tomo III.)

“Of what fatherland, of what tribe is he? He is rich.”^30 (Athenaei Deipnosophistae, liber IV, sectio 49 [p. 159].)

Demetrius Phalereus says of digging for gold from the mines:

“Greed hopes to draw Pluto himself from the bowels of the earth.”^31 (l.c. liber VI, sectio 23 [p. 233].)

“In money lies the origin of avarice ... little by little a kind of madness blazes up here, no longer avarice, but gold-hunger”^32. (Plinius. Historia Naturalis liber XXXIII, caput III, sectio XIV.)

“For no such shameful evil, as the worth of money,
grew up among men: this can break cities themselves,
this drives men from home and hearth;
this instructs and perverts the noble minds
of righteous men to pursue lawless deeds,
shows mortals the ways of wicked cunning,
and trains them to every god-detested work.”^33
(Sophocles. Antigone [295–301].)

Money as the purely abstract wealth – in which every particular use-value is extinguished, hence also every individual relation between owner and commodity – comes equally into the power of the individual as abstract person, relating completely alienly and externally to his individuality. At the same time, however,

it gives him universal power as his private power. This contradiction is highlighted by Shakespeare f[or] instance:

“Gold! precious, glittering, red gold!
So much of this makes black white, ugly beautiful;
Bad good, old young, cowardly brave, base noble.
... Ye gods! why this? why this, ye gods;
Ha! this lures the priest from the altar;
(4)
Tears the pillow from half-recovered men;
Yea, this red slave looses and binds
Hallowed bonds; blesses the accursed;
It makes leprosy lovely; honours the thief,
And gives him rank, bended knee and influence
In the council of senators; this brings
Suitors to the ageing widow;
... Damned metal,
Common whore of mankind.”^34
(Shakespeare, “Timon of Athens”, Act 5.)

What gives itself for everything and for which everything gives itself appears as the universal means of prostitution.

“These have one mind, and they give their power and strength unto the beast. [And it causes] that no one may buy or sell, save he that hath the mark, or the name of the beast, or the number of his name.”^13

Author’s Notes

(1) This cosmopolitan character of money struck the ancients. “Of what fatherland, of what tribe is he? He is rich.”

(2) Money here appears in fact as their communal being, existing as a thing outside them.

(3) and doctrine of renunciation

(4) Similarly in Aristophanes’ Plutus.

Foreign-language Expressions

1* ready cash
2* commodities
3* of feudal property
4* here and now
5* for here and now
6* (of the whole commercial world), rather than the internal trade
7* necessary commodities
8* superfluous commodities
9* The paterfamilias should be eager to sell, not eager to buy.

Foreign-language Citations

1 “As soon as precious metals become objects of commerce, a universal equivalent for everything, they also become a measure of power between nations. Hence the mercantile system.”

2 “In the year 760 the poor people turned out in numbers to wash gold from the riversands south of Prague, and 3 men were able in the day to extract a mark (half a pound) of gold; and so great was the consequent rush to ‘the diggings’, that in the next year the country was visited by famine.” (Abhandlung von dem Alterthume des böhmischen Bergwerks, von M. G. Körner, Schneeberg. 1758.)

3 “Money has the quality of being always exchangeable for what it measures.” (Bosanquet.)

4 “Money can always buy other commodities, whereas other commodities cannot always buy gold.”

5
“There must be a very considerable amount of the precious metals applicable and applied as the most convenient mode of adjustment of international balances.” (
Tooke
.)

6
“Gold and silver... may be counted upon to realise on their arrival nearly the exact sum required to be provided”... “Gold and silver possess an infinite advantage over all other descriptions of merchandise for such occasions, from the circumstance of their being universally in use as
money
.”

7
“It is not in tea, coffee sugar, or indigo, that debts, whether foreign or domestic, are usually contracted to be paid, but in
coin
; and a remittance, therefore, either in the identical coin designated, or in bullion which can be promptly turned into that coin through the Mint or Market of the country to which it is sent, must always afford to the remitier the most certain, immediate, and accurate means of effecting his objects, without risk of disappointment from the failure of demand or fluctuation of price.”

8
“Any other article might in quantity or kind be beyond the usual demand of the country to which it is sent”.

9
“The introduction of money which buys all things... brings in the necessity of legal alienation”

11
In 1593 the Cortes made the following representation to Philip II: ‘The Cortes of Valladolid in the year ’48 supplicated Your Majesty to permit no longer the entry into the kingdom of candles, glassware, jewellery, knives, and other similar things which came from without, in order to exchange these articles so useless to human life for gold, as if the Spaniards were Indians’.”

11
All hide and bury their money very secretly and very deep, especially the gentiles (non-Mohammedans), who are almost alone the masters of trade and money, infatuated as they are with the belief that the gold and silver they hide during their lifetime will serve them after death.

12
These have one mind, and shall give their power and strength unto the beast... And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.

13
As gold and silver are not and never have been wealth in themselves, are worth only relatively, and only in so far as they can procure the things necessary to life, for which they serve merely as pledge and appraisement, it is indifferent whether one has more or less of them, provided they can produce the same effects.

14
provided there is enough of them to support the prices contracted for the necessaries of life

15
commodities are appraised

16
money is only the means and the journey, whereas the useful commodities of life are the end and the aim

17
in a continual movement, which it can be only so long as it is movable... ; but as soon as it becomes immovable..., all is lost

18
the science of finance is only the thorough knowledge of the interests of agriculture and commerce

19
true wealth ... complete enjoyment, not only of the needs of life, but even of all superfluity and of all that can give pleasure to sensuality

20
These metals (gold and silver) have been turned into an idol, and, leaving aside the object and the intention for which they were called into commerce, namely to serve as pledges in exchange and mutual transfer,... they have been almost removed from this service to form divinities to whom more goods, precious needs, and even men have been and are sacrificed every day than blind antiquity ever immolated to those false divinities which for so long constituted the whole cult and religion of the greater part of peoples.

21
The misery of peoples comes only from having made a master, or rather a tyrant, of what was a slave.

22
to restore things to their natural state

23
the equivalence in which it (money) must stand with all other commodities, in order to be ready to effect their exchange at any moment, has immediately received a great blow

24
Behold, then, the slave of commerce become its master... The facility that money offers for serving all crimes causes its emoluments to double in proportion as corruption seizes hearts; and it is certain that almost all crimes would be banished from a state if as much could be done with this fatal metal

25
money... has become the executioner of all things

26
an alembic which has caused an appalling quantity of goods and commodities to evaporate in order to form this fatal extract [for the master]

27
commodities themselves will be restored to their just value

28
money ... declares war ... on the whole human race

29
And so widely has the intercourse of peoples spread throughout the globe that one can almost say the whole world has become a single city in which a perpetual fair of all merchandise is held, and where every man, by means of money, can supply himself from his own house with and enjoy all that the earth, the animals and human industry produce elsewhere. Marvellous invention!

30
But what is his lineage? Rich.

31
Greed, hoping to bring up Pluto himself from the bowels of the earth.

32
But from money first arose avarice... This gradually burst forth into a kind of madness, no longer avarice but hunger for gold.

33
For nothing so evil as money has grown up among men. This it is that sacks cities, this drives men from their homes; this teaches and perverts honest minds to set themselves to shameful acts; this shows men to have villainy and to know impiety in every deed.

34
Gold! yellow, glittering precious gold!
[...] Thus much of this, will make black white; foul, fair;
Wrong, right; base, noble; old, young; coward, valiant.
... What this, you gods! Why this
Will lug your priests and servants from your sides;
Pluck stout men’, pillows from below their heads.
This yellow slave
Will knit and break religions; bless the accours’d;
Make the hoar leprosy ador’d; place thieves
And give them title, knee and approbation
With senators of the bench; this is it,
That makes the wappen’d widow wed again
... Come damned earth,
Thou common whore of mankind.

[Fragment of the Urtext of A Contribution to the Critique of Political Economy – Part 5]

Karl Marx
Urtext “Zur Kritik”

4) The Precious Metals as Bearers of the Money Relation

The bourgeois process of production initially seizes upon metallic circulation as a ready-made, transmitted organ, which, though gradually restructured, perpetually preserves its basic structure. The question, therefore, why gold and silver, rather than other commodities, serve as the material of money falls beyond the boundaries of the bourgeois system, and we shall, therefore, only highlight the most essential points in a quite summary fashion. The answer is simply that the specific natural properties of the precious metals, i.e., their properties as use-values, correspond to the economic functions which, to a higher degree than all other commodities, qualify them to serve as the bearers of the money function.

Like labour-time itself, the object which is to count as its specific incarnation must be able to represent purely quantitative differences, so that sameness, uniformity of quality, is presupposed. This is the first condition for the function of a commodity as the measure of value. If, for example, I estimate all commodities in oxen, hides, corn, etc., I must in fact measure them in ideal average oxen, average hides, average corn, because ox differs from ox, corn from corn, hide from hide qualitatively; a difference in the use-value of specimens of the same kind occurs. This requirement of qualitative indistinguishability, independent of time and place, and hence of equality with equal quantity, is the

first requirement in this respect. The second, likewise arising from the necessity of presenting purely quantitative difference, is great divisibility and recombinability of the parts, so that, according to the magnitude of the value of the | commodity, the general equivalent can be cut up without its use-value thereby being impaired. Gold and silver, as simple bodies in which only quantitative division takes place, are representable, reducible to the same fineness. The sameness of quality. Equally divisible, recombinable. Of gold it may even be said that it is the oldest known metal, the
first metal discovered
. Nature herself, in the great gold-washings of the rivers, undertakes the work of art, and for its discovery requires from man only very crude labour, neither science nor developed instruments of production. “The precious metals agree in their physical properties, so that they should in equal quantities be identical with one another to such an extent that there is no ground for preferring one to the other. This does not, for instance, apply to equal numbers of oxen and equal quantities of corn.”
1
Likewise, gold is found in a purer state than all other metals; in virgin, crystalline form, in isolation: “separated from the commonly occurring bodies”, rarely alloyed with anything but silver. Gold “isolated, individualised”: “Gold is distinguished, with very few exceptions, strikingly from the other metals by the fact that it is found in nature in its
metallic state
” (the other metals in minerals (in their chemical being)) “. Iron and copper, tin, lead and silver are usually discovered in chemical combination with oxygen, sulphur, arsenic or carbon; and the few extraordinary occurrences of these metals in an uncombined or – as it was formerly called –
virgin
state are to be described rather as mineralogical curiosities than as everyday phenomena. Gold, however, is always found native or metallic... Besides, gold, since it forms in the rocks most exposed to the influence of the atmosphere, is found in the
detritus
of the mountains. … [Fragments] of rock are constantly breaking loose. They are carried by the floods into the valleys and moulded into pebbles by the constant work of flowing water.”
2
Gold, precipitated by its specific gravity. It is thus found in river-beds and in alluvial land. River-gold the first gold that was found. (River-washing learned before mining)... “Gold occurs most frequently pure or in any case so nearly pure that its metallic character is immediately recognisable, both in rivers and in quartz veins. … Rivers are in fact great natural
cradles,
for they wash away all the lighter and finer particles at once, while the heavier ones either cling to na-

tural obstacles or are left behind where the force or velocity of the current slackens. … [I]n almost all, perhaps all, the countries of Europe, Africa and Asia, larger or smaller quantities of gold were from very early times washed out of auriferous deposits with simple contrivances.”
3
Gold-washing and gold-digging are quite simple labours, whereas mining (and therefore gold-mining too) is an art requiring the employment of capital and more collateral sciences and arts than any other industry. [[Ore-washing done by nature.]]

Exchange-value as such presupposes a communal substance and reduces all differences to merely quantitative ones. In the function of money as measure, all values are initially reduced to merely different quanta of the measuring commodity. This is the case with the precious metals, which thus appear as the natural substance of exchange-value as such. “Metals possess the peculiarity and characteristic that in them alone all relations are reduced to a single one, namely their quantity; that by nature they have received no varying quality, neither in their inner structure nor in their external form and working-up.”
4
(
Galiani
, l.c., p. 130.) (
Sameness of quality
in all parts of the world; admit of minute division and exact apportionment.) This merely quantitative difference is just as important for money as medium of circulation (coin) and means of payment, since it possesses no individuality, an individual piece of money, but the important thing is that merely an equal quantity of the same material is returned, not
the same
piece: “Money is repaid only

in

natura
…. which fact distinguishes this instrument from all other machinery … indicates the character of its service … clearly proves the uniqueness of its function”.
5
(267.
Opdyke.
)

The diversity of the functions which money serves allows them to represent sensuously the change in the formal determinations of money. Corresponding to the diversity of the functions money serves, whether as the universal commodity, as coin, as raw material for luxury articles, material of accumulation, etc., is the fact that gold and silver, by being melted down, can always be reduced again to their purely metallic state, and can likewise be reduced from this state into any other state; thus gold and silver, unlike other commodities, are not bound to a particular use-form given to them. It can pass from the bar form into the coin form, etc., and vice versa, without losing its value as raw material, without endangering the processes of production and consumption. As
means of circulation
gold and silver have the advantage over other commodities that their great natural specific weight – presenting relatively great heaviness in a small space – is matched by an economic specific weight, enclosing (objectifying) relatively much labour-time, i.e., a large exchange-value, in a small space. The latter is naturally connected with their relatively rare occurrence as natural objects. Hence ease of transport, of transfer, etc. In a word, ease of real circulation, which is of course the first condition for their economic function as means of circulation.

Finally, as the stationary existence of value, as the material for hoard-formation, their relative indestructibility; their eternal duration, non-oxidisability in the air (“the treasure which neither moth nor rust doth corrupt”), their difficulty of fusion; for gold in particular its insolubility in acids except in free chlorine (aqua regia, a mixture of nitric acid and hydrochloric acid). As a principal factor, finally, emphasis must be placed on the
aesthetic properties
of gold and silver, which make them the direct representations of superfluity, adornment, splendour, of the naturally grown Sunday needs, of wealth as such. Colour-glitter, ductility, ability to be worked into tools, as well as to be put to the service of glorification or to be made subservient to other objects. Gold and silver appear, in a way, as a solid light, which is dug out of the underworld itself. Apart from rarity, the great softness of gold and silver makes them unsuited as instruments of production compared with iron, and even with copper (in the hardened form in which the ancients used it). But the use-value of metals on a large scale is connected with their role in the immediate production process. Gold and silver are excluded from this just as they are generally not indispensable objects of use. “Money must have a direct (use-) value,... but founded on a besoin factice. Its material must not be indispensable for the existence of man, because the whole quantity which serves as coin” [[as money in general, also in the form of the hoard accumulated]] “cannot be individually applied, must always circulate”. (
Storch
, Vol. II, pp. 113, 114 l.c.) (The part accumulated as hoard also cannot be “individually” applied, since accumulation consists in keeping it intact.) This, then, is the one side, according to which the nature of the use-value of gold and silver, of being something dispensable, does not enter into the satisfaction of immediate neediness as an object of consumption, nor as an agent into the immediate production process. It is namely the side according to which the use-value of money must not come into collision with its function as hoard (money) or means of circulation, the need for it as an individual use-value, with the need for it as money in any of its determinations, which springs from circulation, from society itself. This is merely the negative side.

Out of polemic against money, therefore, Peter Martyr, who appears to have been a great friend of chocolate, says of the bags of cacao which, among other things, also served as money among the Mexicans (
De Orbe novo
): “O blessed money of mankind, which grants a sweet and useful drink and which renders its possessors immune against the pestilent plague of avarice, since it can neither be buried nor kept for long”
6

On the other hand, gold and silver are not merely the negatively superfluous, i.e. dispensable objects: but their aesthetic properties, which make them the material of splendour, adornment, brilliance, make them positive forms of superfluity, or means for the satisfaction of needs transcending the everyday and bare natural necessity. They therefore possess use-value in themselves, apart from their function as money. But just as they are natural representatives of merely quantitative relations – because of the sameness of their quality –, so also in their individual use they are the direct natural representatives of superfluity and hence of wealth as such, by virtue of their natural aesthetic properties as well as their dearness.

Ductility – one of the properties that render gold and silver suitable as material for jewellery. Blinding to the eyes. Exchange-value is at first the surplus of necessary use-values intended for exchange. This surplus is exchanged against the superfluous as such, i.e., that which goes beyond the circle of immediate neediness; against the Sunday article as opposed to the everyday article. Use-value as such expresses first of all the relation of the individual to nature; exchange-value
alongside
use-value expresses his command over the use-values of others, his social relation: originally itself again values of Sunday, use that goes beyond immediate physical need.

The
white
colour of silver, which reflects back all light rays in their original mixture; the
red-yellow
of gold, which annihilates all coloured light rays of the mixed light falling on it and throws back only the red.

Here one should consult what was said earlier about the mine-producing countries. [[
Grimm
demonstrates in his
History of the German Language
the connection of the names of gold and silver with colour.]]

We have seen that gold and silver do not fulfil the requirement that is imposed on them as autonomised exchange-value, as directly existing money, of being a constant
magnitude of value
. Their nature as a particular commodity here comes into conflict with their function as money. Nevertheless, as Aristotle already noted, they possess a more permanent magnitude of value than the average of other commodities. For metallic circulation as such, leaving aside the general effect of an appreciation or depreciation of the precious metals on all economic relations, of particular importance are the fluctuations in the value relation between gold and silver, since they constantly serve alongside each other as the material of money, whether in the same country or in different countries. The purely economic reasons for this successive change – conquests and other political upheavals, which exerted a great influence on the relative value of the precious metals in the ancient world, lie beyond the merely economic consideration – must be reduced to the change in the labour-time required for the production of equal quantities of these metals. This latter will depend on the one hand on the relative quantities in which they are found in nature, and on the other hand on the greater or lesser difficulty involved in gaining possession of them in the pure metallic state. From what has been said earlier it already follows that gold, whose finding as river gold or alluvial gold requires neither mining labour nor chemical or mechanical combination, despite its greater absolute rarity, was discovered before silver and for a long time, despite its greater absolute rarity, remained relatively depreciated against silver. Strabo’s assertion that among an Arabian tribe 10 pounds of gold were given for 1 pound of iron, and 2 pounds of gold for 1 pound of silver, therefore appears by no means incredible. On the other hand it is clear that in proportion as the productive power of social labour develops, technology, hence simple labour, becomes dearer, while at the same time the original, superficial sources of gold dry up, and the earth’s crust is broken open on all sides more extensively, the relatively rarer or more common occurrence of the two metals will essentially affect the productivity of labour, and gold will appreciate against silver. (But it is never the absolute quantitative ratio in which the two occur in nature, although that is mostly an essential factor in the labour-time required for their production, but the latter itself that determines their relative value. Hence, although according to the Paris Academy of Sciences (1842) the ratio of silver to gold is to be estimated at 52 : 1, their value ratio was only = 15 : 1.)

Given a certain development of the productive power of social labour, the alternative discovery of new gold or silver deposits must always turn the scale ever more decisively, and gold has the chance, as against silver, of being discovered not only in mines but in alluvial land. There is, therefore, again every probability of a reverse movement in the value relation, namely of a fall in the value of gold as against silver. The opening of silver mines depends on the progress of technology and general civilisation. Once these are given, all changes in the discovery of rich silver or gold deposits become decisive. On the whole we find a repetition of the same movement in the change of the value relation between gold and silver. The first two movements begin from the relative depreciation of gold and end with its appreciation. The last one begins with its appreciation and appears to be heading back towards its originally smaller value relation to silver. In ancient Asia the ratio of gold to silver = 6 : 1 or 8 : 1 (in Menu still lower) (thus in China and Japan the latter still at the beginning of the 19th century); 10 : 1, the ratio in Xenophon’s time, may be regarded as the average ratio of middle antiquity. In late Roman times – the Spanish silver mines opened up by Carthage had played approximately the same role in antiquity as the discovery of America in modern times – approximately the ratio as after the discovery of America, 14 or 15 : 1, although we frequently find a deeper depreciation of silver in Rome.

In the Middle Ages the average ratio can again be set at 10:1, as in Xenophon’s time, although precisely in the Middle Ages local deviations are extraordinarily great. The average ratio in the centuries following the discovery of America = 15:1 or 18:1. The new gold discoveries make it probable that the ratio will be reduced again to 10:1, or 8:1, in any case an opposite movement in the value-ratio to that which has taken place since the 16th century. A more thorough investigation of this special question is not yet in place here.

Foreign-language quotations

1
“The precious metals uniform in their physical qualities, so that equal quantities of it should be so far identical as to present no ground for preferring those one to the others. This is not the case with equal numbers of cattle and equal quantities of grain.”

2
“Gold differs remarkably from the other metals, with a very few exceptions, in the fact, that it is found in nature in its
metallic state
” (the other metals in minerals (in their chemical being)). “Iron and copper, tin, lead and silver are ordinarily discovered in chemical combination[s] with oxygen, sulphur, arsenic, or carbon; and the few exceptional occurrences of these metals in an uncombined, or, as it was formerly called,
virgin
State, are to be cited rather as mineralogical curiosities than as common production[s]. Gold, however, is always found native or metallic... Again gold, from the circumstance of its having been formed in those rocks which are most exposed to the atmospheric action, is found in the debris of the mountains;... the fragments of these rocks broken off, ... borne by floods into the Valleys, and rolled into pebbles by the constant action of flowing water...”

3
“Gold most frequently occurs pure, or, at all events, so nearly so that its metallic nature can be at once recognized, both in rivers and in the quartz-veins... Rivers are, indeed, great natural
cradles
, sweeping off all the lighter and finer particles at once, the heavier ones either sticking against natural impediments or being left whenever the current slackens its force or velocity... In almost all, perhaps in all the countries of Europe, Africa, and Asia, greater or smaller quantities of gold have from ... early times been washed by simple contrivances from the auriferous deposits etc.”

4
“I metalli han questo di proprio e singolare che in essi soli tutte la ragioni si riducono ad una che è la loro quantità, non avendo ricevuto dalla natura diversa qualità, nè nell’ interna loro costituzione ne nell’ esterna forma e fattura.”

5
“Money is returned in
kind only;
which fact... distinguishes this agent from all other machinery... indicates the natura of its Service – clearly proves the singleness of its office.”

6
“O felicem monetam, quae suavem utilemque praebet humano generi potum, et a tartarea peste avaritiae suos immunes servat possessores, quod suffodi aut diu servari nequeat.”

[Fragment of the original text of A Contribution to the Critique of Political Economy – Part 6]

Karl Marx

Original Text ‘Zur Kritik’

5) Appearance of the law of appropriation in simple circulation

The economic relations of the individuals, who are the subjects of exchange, are to be grasped here simply as they appear in the exchange process as presented so far, without reference to more highly developed relations of production. The economic form-determinations constitute precisely the determinacy in which they enter into intercourse with one another (confront one another).

“The worker has an exclusive right to the value which results from his labour.”¹
( Cherbuliez , p. 48, “Riche ou pauvre”. Paris 1841.)

First, the subjects of the exchange process appear as owners of commodities. Since on the basis of simple circulation there exists only one method by which each owner becomes an owner of a commodity, namely through a new equivalent, the property in the commodity that precedes exchange, i.e. property in the commodity not appropriated by means of circulation, property in the commodity which is rather only to enter circulation, appears as arising directly from the labour of its possessor, and labour as the original mode of appropriation. The commodity as exchange-value is merely a product, objectified labour. It is, at the same time, primarily the objectivity of that individual whose labour is represented in it; his own, self-produced, objective existence for others. The production of the commodities does not, admittedly, fall within the simple process of exchange, as it unfolds in the various moments of circulation. They are rather presupposed as finished use-values. They must be on hand before exchange begins, simultaneously, as in purchase and sale, or at least as soon as the transaction is completed, as in the form of circulation in which money serves as means of payment. Whether simultaneously or not, they always enter circulation as pre-existing. The process by which commodities come into being, hence also their original process of appropriation, therefore lies beyond circulation. But since a foreign equivalent can be appropriated only by means of circulation, i.e. the alienation of one’s own equivalent, one’s own labour is necessarily presupposed as the original process of appropriation, and circulation is in fact only the reciprocal exchange of labour which has been incarnated in manifold products.

Thus labour and property in the result of one’s own labour appear as the fundamental presupposition without which the secondary appropriation by means of circulation would not take place. Property founded on one’s own labour forms, within circulation, the basis of the appropriation of alien labour. In fact, if we examine the process of circulation closely, the presupposition is that the exchanging parties appear as owners of exchange-values, i.e. of quantities of labour time materialised in use-values. How they have become owners of these commodities is a process that takes place behind the back of simple circulation and which is extinguished before it begins. Private property is the presupposition of circulation, but the process of appropriation itself does not show itself, does not appear within circulation, but is rather presupposed by it. In circulation itself, the exchange process as it emerges on the surface of bourgeois society, each gives only in so far as he takes, and takes only in so far as he gives. In order to do either, he must have. The procedure through which he has placed himself in the state of having forms none of the moments of circulation itself. Only as private proprietors of exchange-value, whether in the form of the commodity or in the form of money, are the subjects [subjects] of circulation. How they have become private proprietors, i.e. have appropriated objectified labour, is a circumstance which does not seem at all to fall within the consideration of simple circulation. Yet, on the other hand, the commodity is the presupposition of circulation. And since, from its standpoint, alien commodities, hence alien labour, can be appropriated only by alienating one’s own, from its standpoint the process of appropriation of the commodity that precedes circulation necessarily appears as appropriation through labour. Since the commodity as exchange-value is merely objectified labour, and from the standpoint of circulation – which itself is only the movement of exchange-value – alien objectified labour cannot be appropriated except by the exchange of an equivalent, the commodity can in fact be nothing but the objectification of one’s own labour, and just as the latter is in fact the actual process of appropriation of natural products, it appears likewise as the juridical title of property. Circulation only shows how this immediate appropriation, through the mediation of a social operation, transforms property in one’s own labour into property in social labour.

By all modern economists, therefore, one’s own labour has been pronounced the original title of property, whether in a more economic or a more juridical manner, and property in the result of one’s own labour as the fundamental presupposition of bourgeois society. (Cherbuliez: see above. See also A. Smith.) This presupposition itself rests on the presupposition of exchange-value as the economic relation governing the totality of the relations of production and intercourse, and is therefore itself a historical product of bourgeois society, of the society of developed exchange-value. On the other hand, because in the examination of more concrete economic relations than are represented by simple circulation, contradictory laws seem to emerge, all the classical economists right down to Ricardo like to let this view, which springs from bourgeois society itself, pass as a universal law, but to banish its strict reality to the golden ages when no property yet existed. As it were to the times before the economic fall of man, as with Boisguillebert, for example. So that the curious result would arise that the truth of the law of appropriation of bourgeois society would have to be transferred to a time in which this society itself did not yet exist, and the fundamental law of property to the time of propertylessness. This illusion is transparent. Primitive production rests on original communities, within which private exchange appears only as a quite superficial, sporadically occurring exception. With the historical dissolution of these communities, however, relations of domination and bondage, relations of violence, at once enter, which stand in glaring contradiction to the gentle commodity circulation and the relations corresponding to it. Be that as it may, the circulation process, as it appears on the surface of society, knows no other mode of appropriation, and if contradictions should emerge in the further course of the investigation, they must be derived, just as this law of original appropriation through labour, from the development of exchange-value itself.

Presupposing the law of appropriation through one’s own labour – and this is a presupposition that arises from the examination of circulation itself, not an arbitrary one – a realm of bourgeois freedom and equality founded on this law opens up of itself within circulation.

If the appropriation of commodities through one’s own labour presents itself as the first necessity, the social process through which this product must first be posited as exchange-value and as such transformed again into use-value for the individuals presents itself as the second. After appropriation through labour, or the objectification of labour, its alienation, or the transformation of the same into a social form, appears as the next law. Circulation is the movement in which one’s own product is posited as exchange-value (money), i.e. as social product, and the social product is posited as one’s own (individual use-value, object of individual consumption).

It is now again clear:

Another presupposition of exchange, relating to the movement as a whole, is that its subjects produce as subsumed under the division of social labour. The commodities to be exchanged for one another are indeed in fact nothing but labour objectified in different use-values, hence objectified in different ways; they are in fact merely the objective existence of the division of labour, the objectification of qualitatively different kinds of labour corresponding to different systems of needs. In producing a commodity, the presupposition is that my product has use-value, but not for me, not immediately a means of subsistence (in the broadest sense) for me, but is for me immediate exchange-value; it becomes a means of subsistence only after it has assumed the form of the general social product in money and can now be realised in any form of alien, qualitatively different labour. I therefore produce for myself only by producing for society, each member of which in turn works for me in another sphere.

It is further clear that the presupposition that the exchanging parties produce exchange-values presupposes not merely the division of labour in general, but a specifically developed form of it. In Peru, for example, labour was also divided; likewise in the self-sufficing (selfsupporting) small Indian communities. But this is a division of labour that is not only not founded on exchange-value, but on the contrary presupposes a more or less directly communal production. The fundamental presupposition that the subjects of circulation have produced exchange-values, products posited immediately under the social determinateness of exchange-value, and hence have also produced them subsumed under a division of labour of a specific historical shape, includes a mass of presuppositions that arise neither from the will of the individual nor from his immediate natural character, but from historical conditions and relations whereby the individual already finds himself socially determined, as determined by society; just as this presupposition includes relations that present themselves in other production relations of the individuals than the simple ones in which they confront each other in circulation.

The exchanging individual has produced a commodity, and indeed for commodity producers. This implies: On one hand: he has produced as an independent private individual, on his own initiative, determined merely by his own need and his own capacities, out of himself and for himself, neither as a member of a naturally evolved community nor as an individual who participates immediately as a social being in production, and who therefore does not relate to his product as an immediate source of existence. On the other hand, however, he has produced exchange-value, a product that first becomes a product for him only through a specific social process, a specific metamorphosis. He has thus already produced within a context, under conditions of production and relations of intercourse that have only come into being through a historical process, but which appear to him as natural necessity. The independence of individual production is thus supplemented by a social dependence that finds its corresponding expression in the division of labour.

The private character of the production of the exchange-value-producing individual itself appears as a historical product – his isolation, his punctuated self-sufficiency within production, conditioned by a division of labour which in turn rests on a whole series of economic conditions by which the individual is conditioned on all sides in his connection with others and in his own mode of existence.

An English tenant farmer and a French peasant, insofar as the agricultural products are the commodity they sell, stand in the same economic relation. However, the peasant sells only the small surplus over his family’s production. The bulk he consumes himself, and therefore relates to the greater part of his product not as exchange-value, but as use-value, immediate means of subsistence. The English tenant farmer, on the other hand, is entirely dependent on the sale of his product, hence on it as a commodity, and therefore on the social use-value of his product. His production is thus seized and determined in its entire extent by exchange-value. Now it is clear what extremely different development of the productive forces of labour, and division of the same, what different relations of individuals within production are required, so that grain, for example, is produced as mere exchange-value and thus enters wholly into circulation; what economic processes are required to turn a French peasant into an English tenant farmer. Adam Smith, in his development of exchange-value, still makes the mistake of seizing upon the undeveloped form of exchange-value, where it appears only as surplus over the use-value produced for the producer’s own subsistence, as the adequate form of the same, whereas it is only one form of its historical emergence within a system of production not yet seized by it as the general form. In bourgeois society, however, it must be grasped as the ruling form, so that all immediate relation of the producers to their products as use-values has vanished; all products are commercial products. Take a worker in a modern factory, e.g., a cotton factory. If he had not produced exchange-value, he would have produced nothing at all, for he cannot lay his hands on a single tangible use-value and say: this is my product. The more many-sided the system of social needs becomes, and the more one-sided the production of the individual becomes, i.e., with the development of the social division of labour, the production of the product as exchange-value, or the character of the product as exchange-value, becomes decisive.

An analysis of the specific form of the division of labour, of the conditions of production on which it rests, of the economic relations of the members of society into which these conditions resolve themselves, would show that the whole system of bourgeois production is presupposed in order that exchange-value may appear on the surface as the simple starting point and the exchange process, as it unfolds in simple circulation, as the simple social metabolism encompassing the whole of production and consumption. It would thus emerge that already other, more complicated production relations, economic relations of the individuals, more or less colliding with their freedom and independence, are presupposed, so that they, as the free private producers, confront each other in the circulation process in the simple relations of purchases and sales, and figure as its independent subjects. From the standpoint of simple circulation, however, these relations are extinguished. Considered in itself, the division of labour appears in it factually only in the result, its presupposition that the subjects of exchange produce different commodities corresponding to different needs, and that if each depends on the production of all, all depend on his production, supplementing each other, and that thus the product of each individual, by means of the circulation process, to the amount of the magnitude of value he possesses, is a means of participating in social production in general.

The product is exchange-value, objectified general labour, although it is immediately only the objectification of the independent private labour of the individual.

That the commodity must first be alienated, the compulsion for the individual that his immediate product is not a product for him, but only becomes one in the social process of production and must assume this general and yet external form; that the product of particular labour must validate itself socially as the objectification of general labour by assuming the form of the thing – of money – which is exclusively presupposed as the immediate objectivity of general labour – likewise, that through this very process this general social labour is posited as an external thing, money – these determinations form the mainspring, the pulse-beat of circulation itself. The social relations that arise from this therefore emerge directly from the consideration of simple circulation and do not lie behind it, like the economic relations enclosed in the division of labour. [[That this must assume the form of money is a point we shall examine only later, namely that this transformation of the commodity into money itself constitutes an essential moment of simple circulation.]]

How does the individual validate his private labour as general labour and its product as a general social product? Through the particular content of his labour, its particular use-value, which is the object of a need of another individual, so that the latter gives up his own product in exchange as an equivalent. [[That this must assume the form of money is a point we shall examine only later, namely that this transformation of the commodity into money itself constitutes an essential moment of simple circulation.]] Hence through the fact that his labour is a particularity within the totality of social labour, a particular branch complementing it. As soon as labour possesses a content determined by the social interconnection – this is the material determinateness and presupposition – it counts as general labour. The form of the universality of labour confirms itself through its reality as a member of a totality of labours, as a particular mode of existence of social labour.

The individuals confront each other only as owners of exchange-values, as persons who have given each other an objective existence through their product, the commodity. Without this objective mediation they have no relation to one another, considered from the standpoint of the social metabolism that proceeds in circulation. They exist for one another only in a thing-like manner, which is only further developed in the money relation, where their community itself appears as an external and hence accidental thing for all of them. That the social interconnection that arises from the collision of the independent individuals appears simultaneously as a thing-like necessity, and at the same time as an external bond opposite them, represents precisely their independence, for which social existence is indeed a necessity, but only a means, and therefore appears to the individuals themselves as something external, in money even as a palpable thing. They produce in and for society, as social beings, but at the same time this appears as a mere means to objectify their individuality. Since they are neither subsumed under a naturally evolved community, nor on the other hand subsume the community under themselves as consciously communal beings, the community must exist opposite them, as independent subjects, as an equally independent, external, accidental, thing-like entity. This is precisely the condition for their standing simultaneously in a social bond as independent private persons.

Since, therefore, the division of labour, [[in which the social conditions of production under which individuals produce exchange-values can be summed up]] appears in the simple exchange process, circulation, only as 1) non-production of the immediate means of subsistence by the individual himself, through his direct labour; 2) secondly as the existence of general social labour as a naturally evolved totality that unfolds into a circle of particularities, namely that the subjects of circulation possess mutually complementary commodities, each satisfies one aspect of the social total need of the individual, while the economic relations themselves that arise from this specific division of labour are extinguished; we have, in the development of exchange-value, not developed the division of labour further, but only taken it as a fact identical with exchange-value, a fact which in active form, as the particularisation of labour, only expresses what the different use-value of commodities – and without the latter no exchange and no exchange-value would take place – expresses in objective form. In fact, A. Smith, like other economists before him, Petty, Boisguillebert, the Italians, ([..?..]) did nothing else where he pronounces the division of labour as correlative with exchange-value. But Steuart, above all, conceived the division of labour and the production of exchange-values as identical, and, to his commendable difference from other economists, understood this as a form of social production and social metabolism mediated by a particular historical process. What A. Smith says about the productive power of the division of labour is an entirely alien point of view, which does not belong in this place and the place where he has put it, and moreover, with reference to a particular stage of development of manufacture, in no way fits the modern factory system as a whole. The division of labour with which we are dealing here is the naturally evolved and free division within the whole of society, which manifests itself as the production of exchange-values, not the division of labour within a factory (its analysis and combination in a single branch of production; rather the social division of these branches of production themselves, which arises, as it were, without the intervention of the individuals). The division of labour within society would correspond more to the principle of the division of labour within a factory in the Egyptian than in the modern system. The repulsion of social labour from one another into free, mutually independent branches, linked into a totality and unity only by inner necessity (not as in that division by conscious analysis and conscious combination of the analysed), are entirely different things and determined by entirely different laws of development, however much one certain form of the one corresponds to a certain form of the other. Even less has A. Smith conceived the division of labour either in that simple form in which it is only the active form of exchange-value, or in the other where it is a specific productive power of labour; he conceived it, rather, in the form in which the economic antagonisms of production – the qualitative social determinacies under which individuals confront one another as capitalist and wage-labourer, industrial capitalist and rentier, tenant farmer and ground-rent owner, etc. – are themselves conceived as the economic forms of a particular mode of the division of labour.

When the individual produces his immediate means of subsistence, as e.g. for the most part in countries where naturally evolved agricultural relations persist, his production has no social character and his labour is not social labour. When the individual produces as a private individual – this position of his, however, is itself by no means a product of nature, but the refined result of a social process –, the social character shows itself in the fact that, in the content of his labour, he is determined by the social nexus and works only as a member of it, i.e. for the needs of all others – thus social dependence exists for him –, but he himself undertakes this or that labour as he pleases; his particular relation to particular labour is not socially determined; his pleasure is naturally determined by his natural aptitudes, inclinations, natural conditions of production in which he finds himself placed, etc.; so that, in fact, the particularisation of labour, the social unfolding of it into a totality of particular branches, appears on the side of the individual such that his own spiritual and natural particularity at the same time gives itself the form of a social particularity. From his own nature and its particular presuppositions springs for him the particularity of his labour – first the objectification of it –, which, however, he simultaneously knows as the validation of a particular system of needs and the realisation of a particular branch of social activity. The division of labour thus conceived as the social reproduction of the particular individuality, which thereby at once becomes a link in the total development of humanity and the individual, by means of his particular activity, is enabled to enjoy the general production, to enjoy all-sided social enjoyment – this conception, as it emerges from the standpoint of simple circulation, which is thus confirmation of the freedom of individuals instead of its sublation, is still common currency in bourgeois economy.

This natural diversity of individuals and their needs forms the motive for their social integration as exchangers. D’abord,* they confront one another in the exchange act as persons mutually recognising each other as proprietors, as persons whose will pervades their commodities and where mutual appropriation by mutual divestiture takes place only by their common will, thus essentially by means of contract. Here enters the juridical moment of the person and the freedom contained in it. In Roman law, the servus* is therefore correctly defined as one who cannot acquire through exchange. Furthermore: It is present in the consciousness of the exchanging subjects that each is only an end in itself in the transaction; that each is only a means for the other; finally, that the reciprocity according to which each is at once means and end, and indeed attains its own end only by becoming a means for the other and only becomes a means insofar as it attains its end – that this reciprocity is a necessary fact,* presupposed as the natural condition of exchange, but that as such it is a matter of indifference to each of the two subjects of exchange and has interest for it only insofar as it is its interest. That is to say, the common interest that appears as the content of the total exchange act is indeed present as a fact in the consciousness of both sides, but as such it is not a motive, but exists, so to speak, only behind the back of the individual interests reflected into themselves. The subject may, if it wishes, also have the uplifting consciousness that the satisfaction of its inconsiderate individual interest is precisely the realisation of the sublated individual interest, of the general interest. From the act of exchange itself each of the subjects returns into itself as the final end of the whole process, as the overarching subject. Thus the complete freedom of the subject is realised. Voluntary transaction; force from neither side; becoming a means for the other only as a means for itself or as an end in itself; finally, the consciousness that the general or common interest is precisely only the all-sidedness of the selfish interest.

If circulation thus in every respect is a realisation of individual freedom, then its process, considered as such – for the relations of freedom do not directly concern the economic form-determinations of exchange, but relate either to its juridical form or concern the content, the use-values or needs as such, i.e., considered in its economic form-determinations, it is the complete realisation of social equality. As subjects of circulation they are first of all exchangers, and that each is posited in this determination, hence in the same determination, precisely constitutes their social determination. In fact they confront each other only as subjectified exchange-values, i.e. as living equivalents, beings of equal worth. As such they are not only equal: not even a difference exists between them. They confront each other only as possessors of exchange-values and as requiring exchange, as agents of the same general indifferent social labour. And indeed they exchange exchange-values of equal magnitude, for it is presupposed that equivalents are exchanged. The equality of what each gives and takes is here an express moment of the process itself. As they confront one another as subjects of exchange, so they prove themselves in the act of it. As such, the act is only this proving. They are posited as exchangers and hence as equals, and their commodities (objects) as equivalents. They exchange only their objective existence as something of equal value. They themselves are of equal value and prove themselves in the exchange act as beings of equal worth and indifferent to one another. The equivalents are the objectification of the one subject for the other; i.e. they themselves are of equal value and prove themselves in the exchange act as beings of equal worth and indifferent to one another. The subjects are in exchange only for one another through the equivalents as beings of equal worth and prove themselves as such through the change of the objectivity in which the one is for the other. Since they exist for one another only as subjects of equivalence, they are, as beings of equal worth, at the same time indifferent to one another. Their other difference does not concern them. Their individual particularity does not enter into the process. The material diversity in the use-value of their commodities is extinguished in the ideal existence of the commodity as price, and insofar as this material difference is the motive of the exchange, they are mutually a need for each other (each represents the other’s need) and a need satisfied merely by the equal quantum of labour time. This natural diversity is the ground of their social equality, posits them as subjects of the exchange. If A’s need were the same as B’s, and if A’s commodity satisfied the same need as B’s, then there would be no relation at all between them, as far as economic relations are concerned (on the side of their production). The mutual satisfaction of their needs, mediated by the material diversity of their labour and their commodity, makes their equality a fulfilled social relation and their particular labour a particular mode of existence of social labour in general.

In so far as money enters the picture, it is so far from abolishing this relation of equality that it is in fact its real expression. To begin with, in so far as it functions as a price-setting element, as measure, it is precisely the function of money, also in point of form, to posit commodities as qualitatively identical, to express their identical social substance, in that only quantitative difference takes place. In circulation, the commodity of each then also appears in fact as the same thing; it obtains the same social form of the medium of circulation; in it all particularity of the product is extinguished and the owner of each commodity becomes the owner of the tangibly subjectivised universally valid commodity. Here it holds in the strict sense that money
non olet
5*
. Whether the taler someone holds in his hand has realised the price of dung or of silk is absolutely not to be detected, and all individual difference, in so far as the taler functions as taler, is extinguished in the hand of its possessor. This extinction

is, however, all-sided, since all commodities are transformed into coin. Circulation posits everyone in a certain moment not only as equal to the other, but as the same thing, and its movement consists in each alternately, with regard to its social function, taking the place of the other. In circulation, it is true, the exchangers also face one another qualitatively as buyer and seller, as commodity and money, but, firstly, they change places, and the process consists just as much in positing inequality as in cancelling the positing of equality, so that the latter appears only formally. The buyer becomes seller, the seller becomes buyer, and each can become buyer only as seller. The formal difference exists for all subjects of circulation simultaneously as social metamorphoses through which they have to pass. Furthermore, the commodity is ideally as price just as much money as the money that confronts it. In money as that which circulates itself, such that it now appears in one hand, now in another, and is indifferent to this appearing, equality is objectively posited and difference only a formal one. Each appears as possessor of the medium of circulation vis-à-vis the other, himself as money, in so far as the process of exchange is considered. The particular natural difference that lay in the commodity is extinguished and is continually extinguished by circulation.

If we examine the social relation of individuals within their economic process at all, we must simply keep to the form-determinations of this process itself. But in circulation no difference exists other than that of commodity and money, and it is equally the constant disappearance of that difference. Equality appears here as a social product, just as exchange-value is social being.

Since money is only the realisation of exchange-value and a developed system of exchange-value is a money system, so the money system can in fact only be the realisation of this system of freedom and equality.

In the use-value of the commodity, the particular individual side of production (labour) is contained for the exchang[er]; but in his commodity as exchange-value all commodities count equally as objectification of social, undifferentiated labour pure and simple; their owners as equals, as co-ordinate functionaries of the social process.

| As regards the appearance of money in its third function, it has already been shown earlier that as the general material of contracts, the general means of payment, it cancels all specific difference in performances,
raises them to equality. It posits all as equal before money, but money is only their own objectified

social connection. As the material of accumulation and of the formation of hoards, equality could at first appear to be cancelled, in that the possibility arises for one individual to enrich himself more, to acquire more title to the general production, than another. But no one can extract money at the expense of the other. He can only take in the form of money what he gives in the form of commodity. The one enjoys the content of wealth, the other takes possession of its general form. If the one impoverishes and the other enriches himself, that is a matter of their free will, their thrift, industry, morality, etc., and by no means arises from the economic relations themselves, the relations of intercourse in which the individuals face one another in circulation. Even inheritance and similar juridical relations, which may prolong such inequalities so arising, do no injury to social equality. If the original relation of individual A is not in contradiction with the same, this contradiction can certainly not be produced by the fact that individual A takes the place of individual B, and immortalises him. This is rather a making good of the social law beyond the natural limit of life; a consolidation of the same against the accidental action of nature, whose influence as such would rather be a cancellation of the freedom of the individual. Besides, since the individual in this relation is only the individuation of money, he is, as such, as immortal as money itself. Finally, the hoard-forming activity is a heroic idiosyncrasy, a fanaticism of asceticism, which does not inherit itself naturally like blood. Since only equivalents are exchanged, the heir must throw the money back into circulation in order to realise it as enjoyment. If he does not do so, he simply continues to be a useful member for society and to take no more from it than he gives it. The nature of things, however, brings with it that prodigality then, as Steuart says, as an “agreeable leveller
6*
”, again equalises the inequality, so that this itself appears only as vanishing.

The process of exchange-value developed in circulation therefore not only respects freedom and equality; they are its product; it is their real basis. As pure ideas they are idealised expressions of its various moments; as developed in juridical, political, and social relations they are merely reproduced in other potencies. This has also been confirmed historically. Not only is the trinity of property, freedom, and equality on this basis theoretically formulated first by the

Italian, English, and French economists of the 17th and 18th centuries. They were realised only in modern bourgeois society. The ancient world, which did not have exchange-value as the basis of production, but rather perished in its development, produced a freedom and equality of a quite opposite and essentially only local content. On the other hand, since in the ancient world, within the circle of the free at least, the moments of simple circulation developed, it is explicable that in Rome, and especially in imperial Rome, whose history is precisely the history of the dissolution of the ancient community, the determinations of the juridical person, of the subject of the exchange process, were developed, the law of bourgeois society was elaborated as to its essential determinations, and above all had to be asserted against the Middle Ages as the law of the emerging industrial society.

Hence follows the error of those socialists, especially the French, who seek to demonstrate socialism as the realisation of the bourgeois ideas not discovered by the French Revolution, but historically put into circulation, and labour to demonstrate that exchange-value
originally
(in time) or in its concept (in its adequate form) was a system of freedom and equality of all, but that it has been falsified by money, capital, etc. Or also that history has so far made still unsuccessful attempts to carry them through in the form corresponding to their truth, and now, like Proudhon for example, have sought to discover a panacea by means of which the genuine history of these relations is to be supplied in the place of their falsified one. The system of exchange-value and, even more, the money system are in fact the system of freedom and equality. The contradictions, however, which appear with a deeper development are immanent contradictions, entanglements of this property, freedom and equality themselves; which occasionally pass over into their opposite. It is as pious as it is silly to wish, for instance, that exchange-value should not develop from the form of commodity and money into the form of capital, or that labour producing exchange-value should not develop further into wage labour. What distinguishes these socialists from the bourgeois apologists is on the one hand the feeling for the contradictions of the system, on the other the utopianism of not grasping the necessary difference between the real and the ideal form of bourgeois society, and therefore of undertaking the superfluous business of wanting to realise once again the ideal expression, the transfigured and | reflected light-image projected by the reality itself as such and thrown off by it.

To this view there is opposed from another side the vapid demonstration that the contradictions versus this outlook resting on the consideration of simple circulation, as soon as we proceed to more concrete stages of the production process, descend from the surface more into its depth, are in fact mere semblance. It is in fact maintained, and proved by
abstraction
from the specific form of the more developed spheres of the social production process, of the more developed economic relations, that all economic relations are only ever different names for the same relations of simple exchange, commodity exchange, and of the corresponding determinations of property, freedom and equality. Out of empiricism, for example, it is taken up that alongside money and commodity, exchange-value relations are still encountered in the form of capital, interest, ground-rent, wages, etc. By a process of very cheap abstraction, which at will drops now this, now that side of the specific relation, it is reduced to the abstract determinations of
simple
circulation and thus it is
proved
that the economic relations in which the individuals find themselves in those more developed spheres of the production process are only the relations of simple circulation, etc. It is in this way that Herr Bastiat has welded together his economic theodicy, the “
Harmonies économiques
”. In contrast to the classical economy of Steuart, Smith, Ricardo, which possesses the power to present the relations of production in their pure form relentlessly, this impotent, strained whitewashing is asserted as progress. Bastiat is not, however, the inventor of this harmonious view, but has rather borrowed it from the American Carey. Carey, for whose view only the new world, of which he is a member, acted as historical background, proved in the very voluminous works of his first epoch the economic “harmony” which is everywhere still reduction to the abstract determinations of the simple exchange process, in that he has these simple relations everywhere falsified by the state on the one hand and the influence of England on the world market on the other. In themselves, the harmonies are there. Within non-American countries, however, they are falsified by the state, in America itself by the most developed form in which these relations appear, their world-market reality, in the form of England
(1)
Carey, um

to produce it, he finds no other means than to call upon the *diabolus* he himself has denounced, the state, finally to summon it as a guardian angel, to place it at the gate of the harmonious paradise – namely, protective tariffs. Since, however, he is a researcher, not a *belletrist* like Bastiat, he had to go further in his last work, “Slavery at Home and Abroad (?)”. The development of America in the last eighteen years has dealt such a blow to his harmonious view that he now no longer sees the falsification of the intrinsically still upheld “natural” “harmonies” only in the external influence of the state, but in –  
*trade*  
! Admirable result this, to celebrate exchange-value as the foundation of harmonious production, and then to allow it, through the developed form of exchange, trade, to be sublated in its immanent laws!  
(2)  
It is in this desperate form that he pronounces the dilatory[3] judgement, that the development of harmonious exchange-value is disharmonious.

Author’s Notes

(1) e.g. It is harmonious when, within a country, patriarchal production gives way to industrial production, and the dissolution process which accompanies this development is grasped only in its positive aspect. But it becomes disharmonious when English large-scale industry puts an end, with terror, to the patriarchal or petty-bourgeois forms of foreign national production. The concentration of capital within a country, and the dissolving effect of this concentration, present only positive sides to him. But the effects of concentrated English capital, which he denounces as England’s monopoly, on other national capitals, is disharmony itself.

(2) Carey is in fact the only original economist of America, and his works derive their great significance from the fact that, in material terms, they are everywhere based upon bourgeois society in its freest and broadest reality. He expresses the great American conditions in abstract form, and indeed in contrast to the Old World. The only real background of Bastiat is the pettiness of French economic conditions, which everywhere stick out their long ears from his harmonies, and in contrast to which the idealised English and American relations of production are formulated as “demands of practical reason”. Carey is therefore rich in independent, so to speak *bona fide*, researches into specific economic questions. Where Bastiat exceptionally pretends to descend from his coquettishly polished commonplaces to the consideration of real categories, e.g. ground-rent, he simply copies Carey. While the latter, therefore, mainly combats the contradictions against his harmonious view, in the form in which they were developed by the classical English economists themselves, Bastiat pleads against the socialists. Carey’s deeper view finds the antagonism which he, as a harmoniser, has to combat within political economy itself, while the vain, dogmatic *raisonneur* sees it merely outside.

Editors’ Notes

[1] With this page a new notebook begins. Marx distinguishes two parts within it. The first, comprising pages 1–14, he designates in the references to my own notebooks as Notebook B′, the second, from page 16 to 19 of this same notebook, as Notebook B II′. Between the two parts lies the empty page 15.

[2] “Leistungen” also legible as “Bestimmungen”

[3] “dilatorische” also legible as “dialektische” or “delektorische”

Foreign Expressions

1* this very process  
2* Firstly  
3* Slave  
4* Fact  
5* does not stink  
6* equalizer

Foreign Quotations

1

“Le travailleur a un droit exclusif sur la valeur resultant de son travail.”

[Fragment of the Urtext of *Zur Kritik der politischen Ökonomie* – Part 7]

Karl Marx

Urtext *Zur Kritik*

| 6) Transition to Capital

Let us now grasp the circulation process in its totality: Let us first examine the *formal character* of simple circulation.

In fact, circulation presents only the formal process in which the two moments which immediately coincide and immediately diverge in the commodity, of which the commodity is the immediate unity – use-value and exchange-value – are mediated. The commodity alternates in each of the two determinations. Insofar as the commodity is posited as price, it is of course also exchange-value, but its existence as use-value appears as its reality; its existence as exchange-value is only its relation, its ideal existence. In money, it is of course also use-value, but its existence as exchange-value appears as its reality, since the use-value, as universal, is only ideal.

In the commodity, the material has a price; in money, exchange-value possesses a material.

The two forms of circulation are to be examined: C–M–C and M–C–M.

The commodity which has been exchanged for commodity by means of money withdraws from circulation in order to be consumed as use-value. Its determination as exchange-value and hence as commodity is extinguished. It is now use-value as such. If, however, it is made independent in money in opposition to circulation, it presents only the insubstantial general form of wealth and becomes a useless use-value, gold, silver, insofar as it does not re-enter circulation as means of purchase or means of payment. It is in fact a contradiction that the independent exchange-value – supposed to be the absolute existence of exchange-value, that in which it is withdrawn from exchange. The only economic reality which hoard formation possesses in circulation is a subsidiary one for the function of money as means of circulation (in the two forms of means of purchase and means of payment) – to form reservoirs which allow the possibility of the expansion and contraction of the currency (hence the function of money as general commodity).

In circulation two things take place. Equivalents are exchanged, i.e. equal magnitudes of value; at the same time, however, the determinations of the two sides are confounded with each other. The exchange-value fixed in money vanishes (for the owner of the money) as soon as it is realised in the commodity as use-value; and the use-value existing in the commodity vanishes (for its owner) as soon as its price is realised in money. Through

the simple act of exchange, each can be lost in its determination as against the other only as soon as it is realised in it. Neither can maintain itself in the one determination by passing over into the other.

Circulation considered in itself is the *mediation of presupposed extremes*. But it does not posit these extremes. As the whole of mediation, as the total process itself, it must therefore be mediated. *Its immediate being is therefore pure semblance*. It is the *phenomenon of a process taking place behind its back*. It is now negated in each of its moments – as commodity, as money, and as the relation of the two, as the simple exchange of the two, circulation.

The repetition of the process from both points, money and commodity, does not arise from the conditions of circulation themselves. The act cannot rekindle itself anew. Circulation therefore does not carry within itself the principle of self-renewal. It proceeds from presupposed moments, not from moments posited by itself. Commodities must always be thrown into it anew, and indeed from outside, like fuel into a fire. Otherwise it expires in indifference. It would expire in money as an indifferent result which, insofar as it no longer stood in relation to commodities, prices, circulation, would have ceased to be money, to express a relation of production; of which only its metallic existence would be left, but its economic existence would be annihilated.

To money as the “general form of wealth”, as independent exchange-value, the whole world of real wealth stands opposed. It is the pure abstraction of wealth, hence, held fast as such, an imaginary magnitude. Where general wealth seems to exist in entirely material, tangible form as such, it has its existence solely in my head, it is a pure figment of the brain. As the material representative of general wealth, money is only realised by being thrown back into circulation, vanishing against the particular modes of wealth. In circulation, it is always actual only insofar as it is given away. If I want to hold onto it, it evaporates in my hand into a mere spectre of wealth. Making it vanish is the only possible way of securing it as wealth. The dissolution of the hoarded sum in transient enjoyments is its realisation. It can then be hoarded again by other individuals, but then the process begins anew. The independence of money from circulation is mere semblance. Money therefore sublates itself in its determination as perfected exchange-value.

In simple circulation, exchange-value, in its form as money, appears as a simple thing, for which circulation is only an external movement, or which is individualised as a subject in a particular matter. Further, | circulation itself appears as a merely formal movement: realisation of the prices of commodities, exchange (ultimately) of different use-values with one another. Both are presupposed as the starting-point of circulation: the exchange-value of the commodity, and commodities of different use-value. Likewise, falling outside circulation is the withdrawal of the commodity by consumption, hence its destruction as exchange-value, and the withdrawal of money, its becoming independent, which is again another form of its destruction. Circulation presupposes the definite *price* (the exchange-value measured in money, hence the latter itself, the magnitude of value); it gives it only formal existence in money. But it is not *created* in circulation.

Simple circulation, which is merely the exchange of commodity and money, like commodity exchange in mediated form, even continuing up to hoard formation, can exist historically precisely because it is only a mediating movement between presupposed starting-points, without exchange-value having taken hold of the production of a people either over the entire surface or in depth. At the same time, however, it appears historically how circulation itself leads to bourgeois, i.e. exchange-value-positing production and creates for itself a different basis from the one from which it immediately proceeded. The exchange of surplus is exchange- and exchange-value-positing intercourse. But it extends only to the act of exchange itself and plays alongside production itself. If, however, the appearance of intermediaries soliciting exchange (Lombards, Normans, etc.) is repeated, and a continuous trade develops in which the producing peoples still only engage, so to speak, in passive trade, because the impulse to exchange-value-positing activity comes from outside, not from the internal shape of production, the surplus of production must be not only an occasional, contingent surplus, but a constantly repeated one, and thus the product itself acquires a tendency directed towards circulation, towards the positing of exchange-values. At first the effect is more material. The circle of needs is expanded; the aim is the satisfaction of the new needs, and hence greater regularity and increase of production. The organisation of domestic production itself is already modified by circulation and exchange-value, but it has not yet been seized by it either over its whole surface or in its whole depth. This is the so-called civilising influence of foreign trade. It

depends then, partly on the intensity of this influence from outside, partly on the degree of internal development, how far the exchange-value-positing movement seizes the whole of production. In England, for example in the 16th century, the development of Dutch industry gave English wool production great commercial importance, just as on the other hand the need especially for Dutch and Italian goods grew. In order now to have more wool for export as a means of exchange, arable land was converted into sheep pasture, the small leasehold system was broken up, and there took place that whole violent economic upheaval which Thomas Morus laments (denounces). Agriculture thus lost the character of labour for use-value – as immediate source of subsistence – and the exchange of its surplus lost the character, previously indifferent and external to the internal construction of agrarian relations. Agriculture itself began at certain points purely determined by circulation, to be transformed into purely exchange-value-positing production. With this the mode of production was not only altered, but all the old, traditional population and production relations, economic relations which corresponded to it, [were] dissolved. Thus circulation here presupposed a production that knew exchange-value only in the form of the superfluous, of the surplus over use-value; but it reverted to a production that took place only with reference to circulation, to production positing exchange-value as its immediate object. This is an example of the historical retrogression of simple circulation into capital, of exchange-value as the form dominating production.

The movement thus only attacks the surplus of the production calculated for immediate use-value, and proceeds only within these limits. The less the whole internal economic structure of society is still seized by exchange-value, the more they appear as the external extremes of circulation, – as fixedly given and passively related to it. The whole movement as such appears become independent over against them as intermediate trade, whose bearers, like the Semites in the intermundia of the ancient world, Jews, Lombards, Normans in those of medieval society, represent to them alternately the different moments of circulation, money and commodity. These are the mediators of the social metabolism.

Here, however, we are not dealing with the historical transition of circulation into capital. Simple circulation is rather an abstract sphere of the bourgeois total production process, which through its own determinations manifests itself as a moment, mere form of appearance of a deeper process lying behind it, just as much resulting from it as producing it – of industrial capital.

Simple circulation is on the one hand the exchange of existing commodities and merely the mediation of these extremes lying beyond it, presupposed to it. The entire activity is limited to the activity of exchange and to the positing of the formal determinations which the commodity traverses as unity of exchange-value and use-value. As such unity the commodity was presupposed or any particular product was only commodity as the immediate unity of these two determinations. Actually as such unity, as commodity, it is not as a resting (fixed) being, but only in the social movement of circulation, in which 1) the two determinations of the commodity, of being use-value and exchange-value, are distributed to different sides. For the seller it becomes exchange-value, for the buyer it becomes use-value. For the seller it is a means of exchange, i.e. the opposite of immediate use-value, because it is use-value for the other, thus as negated immediate, individual use-value; on the other hand, as price, its extent as means of exchange is measured, its purchasing power. For the buyer it becomes use-value, in that its price is realised, i.e. its ideal existence as money is realised. Only by realising it for the other in the determination of pure exchange-value does it become for himself in the determination of use-value. Use-value itself appears doubly; in the hand of the seller as mere, particular materialisation of exchange-value, existence of exchange-value; for the buyer, however, as use-value as such, i.e. as object of the satisfaction of particular needs; for both as price. The one, however, wants to realise it as price, money; the other realises the money in it. It is specific to the existence of the commodity as means of exchange that use-value appears 1) as sublated immediate (individual) use-value, i.e. as use-value for others, for society; 2) as materialisation of exchange-value for its possessor. The duplication and alternation of the commodity in the two determinations: commodity and money is the main content of circulation. But the commodity does not simply stand opposed to money; rather its exchange-value appears in it ideally as money; as price it is ideal money, and the money opposite it is only the reality of its own price. In the commodity, too, exchange-value is present as an ideal determination, as an ideal equation with money; then in money as coin it obtains an abstract, one-sided, but vanishing existence as mere value; then value is extinguished in the use-value of the purchased commodity. From the moment when the commodity becomes simple use-value, it ceases to be a commodity. Its existence as exchange-value is extinguished. As long as it is in circulation, however, it is always posited doubly, not only that it exists as commodity opposite money, but it always exists as a commodity with a price, [with] exchange-value measured in the unit of measurement of exchange-values.

The movement of the commodity through the various moments, where it is price, becomes coin, finally is converted into use-value. It is presupposed as use-value and exchange-value, for only thus is it commodity. But it realises these determinations formally in circulation, and indeed in that firstly, as said, it passes through the different determinations; secondly, however, in that in the process of exchange its being as use-value and as exchange-value is always distributed to two sides, to both extremes of the exchange. Its double nature is dissected in circulation, and it becomes in each of the conditions presupposed in it only through this formal process. The unity of the two determinations appears as an uneasy movement, running through certain moments, and at the same time always two-sided. Always only in this social relation, so that the various determinations of the commodity are in fact merely alternating relations in which the subjects of the exchange comport themselves during the exchange process. This comportment, however, appears as an objective relation in which they are posited by the content of the exchange, its social determinateness, independently of their will. In price, coin, like money, these social relations appear as external to them, subsuming them under themselves. The negation in one determination of the commodity is always its realisation in the other. As price it is already negated, ideally as use-value, and posited as exchange-value; as realised price, i.e. money, it is negated use-value: as realised money, i.e. sublated means of purchase, it is negated exchange-value, realised use-value. It is at first only δυνάμει 2* according to use-value and exchange-value; is first posited as both in circulation, and this is indeed the alternation of these determinations. While thus the alternation and opposition, circulation is at the same time always also the equation of these determinations.

If, however, we consider the form C–M–C, exchange-value appears, whether in its form as price, or in its form as coin, or in the form of the movement of equation, of the movement of exchange itself, only as vanishing mediation. Commodity is finally exchanged for commodity, or rather, since the determination of commodity is extinguished, use-values of different quality are exchanged for one another and circulation itself served only to allow, on the one hand, the use-values to change hands according to need, and on the other, to allow them to change hands in the measure in which labour-time is contained in them; | to allow them to replace one another to the extent that they are equally weighty moments of the general social labour-time. But now the commodities thrown into circulation have attained their purpose. Each in the hand of its new possessor ceases to be a commodity; each becomes an object of need and as such, according to its nature, consumed. Thus circulation is at an end. Nothing remains but the means of circulation as a simple residue. As such residue, however, it loses its form determination. It collapses into its matter, which remains over as the inorganic ash of the whole process. As soon as the commodity has become use-value as such, it is thrown out of circulation, it has ceased to be a commodity. It is therefore not on this side of the content (material) that we must seek the further form determinations leading beyond. Use-value in circulation becomes only that as which it was presupposed independently of it, the object of a specific need. As such it was and remains the material motive of circulation; remains, however, entirely untouched by it as social form. In the movement C–M–C the material appears as the real content of the movement; the social movement only as a vanishing mediation for satisfying individual needs. The metabolism of social labour. In this movement the sublation of the form determination, i.e. of the determinations arising from the social process, appears not only as result, but as purpose; just as the conduct of a lawsuit does for the peasant, even if not for the lawyer. In order, therefore, to pursue the further form determination growing out of the movement of circulation itself, we must keep to the side where the form side, exchange-value as such, develops further; obtains more profound determinations through the process of circulation itself. Hence on the side of the development of money, of the form M–C–M.

Exchange-value as objectified quantum of social labour-time continues in the objectification which it obtains in circulation, right up to its existence as money, as hoard and general means of payment. If money is now fixed in this form, its form determination likewise vanishes; it ceases to be money, becomes mere metal, mere use-value, which, however, since it is not supposed to serve as such, in its metallic quality, is useless, and hence does not, like the commodity, realise itself as use-value in consumption.

We have seen how the commodity realises the moments contained in it by constantly negating one of them. Considering the movement of the commodity as such, exchange-value exists ideally in it as price; it becomes abstract means of exchange in the coin; but in its final realisation in the other commodity, its exchange-value vanishes and it falls out of the process as simple use-value, immediate object of consumption (C–M–C). This is the movement of the commodity in which its existence as use-value is the dominant moment, and the movement is in fact only that it adopts precisely the shape of use-value corresponding to need, instead of the one in which it finds itself as a commodity.

If, on the other hand, we consider the further development of exchange-value in money, it attains in the first movement only its existence as ideal money, or coin, as unity and number. But if we take the two movements together, it becomes apparent that money—which in price exists only as an ideal unit of measure, the imagined material of general labour, and in coin only as a token of value, an abstract and vanishing existence of value, a materialised representation, i.e., a symbol—in its form as money finally negates both determinations, but also contains both as moments, and at the same time establishes itself in a materiality independent of circulation itself, in constant relation to it, even if a negative one.

Considering the form of circulation itself, what comes into being, arises, is produced within it, is money itself, nothing else. Commodities are exchanged in circulation, but they do not arise in it. Money as price and coin is already, to be sure, a specific product of circulation, but only formally. Exchange-value of the commodity is presupposed by price, just as coin itself is nothing but the autonomised form of the commodity as means of exchange, which was likewise presupposed. Circulation creates neither exchange-value nor its magnitude. In order for a commodity to be measured in money, money and commodity must both relate to one another as exchange-values, i.e., as objectifications of labour time.

The commodity’s exchange-value receives in price only an expression separated from its use-value; similarly, the token of value arises only out of the equivalent, the commodity as means of exchange. As means of exchange, the commodity is supposed to be use-value, but can become such only through alienation, since it is not use-value for the person in whose hand it is a commodity, but for the one who exchanges it as use-value. Its use-value for the owner of the commodity consists solely in its exchangeability, its alienability to the extent of the exchange-value represented in it. As universal means of exchange, therefore, in circulation it becomes merely use-value as the existence of exchange-value, and its use-value as such is extinguished. This appears as a simple formal change: that exchange-value is posited as price, or the means of exchange as money. Each commodity as realised exchange-value is the money of account of the remaining commodities, their price-giving element, just as each commodity as means of exchange (but here it founders on the extent to which it is a means of exchange, for it would be a means of exchange only vis-à-vis the person who possesses the commodity that the exchanger needs, and would have to become the final means of exchange in a series of exchanges; apart from the clumsiness¹ of this process, it would again come into conflict with its nature as use-value, since it would have to be divisible into portions in order to effect the various exchanges in succession in the requisite proportions) is a medium of circulation, coin.

In price and coin, both determinations are merely transferred to a single commodity. This appears as a mere simplification. In the relations in which one commodity is the measure of value of all the others, it is a means of exchange, an equivalent, alienable against them; it can really serve as an equivalent, as a means of exchange. The circulation process merely gives these determinations a more abstract form in money as coin and means of exchange. The form C–M–C, this current of circulation in which money figures only as measure and coin, therefore appears only as a mediated form of barter, in whose basis and content nothing is altered. The reflecting consciousness of peoples therefore grasps money in its determination as measure and coin as arbitrary, conventionally introduced inventions for the sake of convenience; because the transformation undergone by the determinations contained in the commodity as the unity of use-value and exchange-value is only formal. Price is only a determinate expression of exchange-value, the universally intelligible expression which it acquires in the language of circulation itself, just as coin, which can also exist in its existence as a mere symbol, is only a figurative expression of exchange-value; but as means of exchange it remains merely a means for the exchange of commodities, and hence no new content enters in. Price and coin do indeed also emerge from commerce; they are in fact the expressions created by commerce, the commercial expressions of the commodity as exchange-value and means of exchange.

The situation is different, however, with money. It is a product of circulation that has, as it were, grown out of it contrary to the agreement. It is no mere mediating form of commodity exchange. It is a form of exchange-value emerging from the circulation process, a social product that is generated of its own accord through the relations into which individuals enter in circulation. As soon as gold and silver (or any other commodity) have developed as measure of value and medium of circulation (whether in the latter case in their corporeal form or replaced by a symbol), they become money, without any doing or willing on the part of society. Their power appears as a fatum, and men’s consciousness, particularly in social conditions that are succumbing to a deeper development of the relations of exchange-value, rebels against the power that a material, a thing, gains over them, against the rule of the accursed metal, which appears as sheer madness. It is in money first, and indeed in the most abstract, hence most senseless, most incomprehensible form—a form in which all mediation is suspended—that the transformation of reciprocal social relations into a fixed, overwhelming, social relation that subsumes the individuals makes its appearance. And the appearance is all the harsher because it arises from the presupposition of free, arbitrary, atomistic private individuals who relate to one another in production only through their reciprocal needs. Money itself contains the negation of itself as mere measure and coin. [[In fact, the commodity regarded by itself is supposed to be for its owner merely the existence of exchange-value; for him its materiality has only the meaning of being the objectivity of general labour time, which is exchangeable with every other objectivity of the same; hence immediately a universal equivalent, money. This side, however, remains hidden, and itself appears only as one side.]] The ancient philosophers, likewise Boisguillebert, regard this as a perversion, an abuse of money, which turns from a servant into a master, depreciates natural wealth, and annuls the symmetry of equivalents. Plato in his Republic wants forcibly to hold money down to being a mere medium of circulation and measure, but not to let it become money as such. Aristotle therefore views the form of circulation C–M–C, in which money functions only as measure and coin, a movement which he calls economic, as the natural and rational one, while he brands the form M–C–M, the chrematistic, as unnatural and contrary to purpose. What is being fought against here is only exchange-value becoming the content and end-in-itself of circulation, the autonomisation of exchange-value as such; the fact that value as such becomes the purpose of exchange and obtains a self-sufficient form, initially still in the simple, palpable form of money. In selling in order to buy, use-value is the purpose; buying in order to sell, value itself.

Now we have indeed seen that money, in its function, is in fact only suspended medium of circulation, whether it is later to enter circulation as a means of purchase or a means of payment. On the other hand, its autonomous behaviour vis-à-vis circulation, its withdrawal from it, robs it of both values: its use-value, because it is not supposed to serve as metal; its exchange-value, because it possesses this exchange-value precisely only as a moment of circulation, as the abstract symbol which commodities place opposite each other of their own value; as a moment of the form-movement of the commodity itself. As long as it remains withdrawn from circulation, it is just as valueless as if it lay buried in the deepest mine. But if it again enters circulation, its imperishability is at an end, the value contained in it passes away into the use-values of the commodities against which it is exchanged, it becomes once more a mere medium of circulation. This is one moment.
It comes out of circulation as its result, i.e., as the adequate existence of exchange-value, the universal equivalent existing-for-itself and persisting in itself.

On the other hand: As the purpose of exchange, i.e., as a movement whose content is exchange-value, money itself, the sole content is the increase of exchange-value, the accumulation of money. In fact, however, this increase is purely formal. Value does not arise from value; rather, value in the form of the commodity is thrown into circulation only to be withdrawn from it in the useless value as a hoard.

‘Rich are you, all say; but to me you are a poor man;
    Wealth proves itself in use.’¹ [Anthologia Graeca XI, 166, 1–2.]

Thus enrichment appears, as regards its content, as voluntary impoverishment. It is only the absence of needs, the renunciation of needs, the renunciation of the use-value of value as it exists in the form of the commodity, that makes it possible to accumulate value in the form of money. The real movement of the form M–C–M does not, namely, exist in simple circulation, where equivalents are merely translated out of the commodity form into the money form and vice versa. If I exchange a thaler for a commodity worth a thaler, and this in turn for a thaler, that is a process devoid of content. In simple circulation, only this is to be considered—the content of this form itself—namely money as an end in itself. That it appears as such is clear; apart from quantity, the dominant form of trade consists in exchanging money for commodity and commodity for money. It can also happen, and does, that in this process the result is not simply the same amount of money as the presupposition. In bad business, less may come out than went in. Here we are concerned only with the significance; the further determination does not belong to simple circulation itself. In simple circulation itself, the increase in the magnitude of value, the movement in which the growth of value is itself the purpose, can appear only in the form of accumulation, mediated by C–M, the constantly renewed sale of the commodity, by not allowing money to run its entire course and, after the commodity has been converted into it, allowing it to convert itself back into commodity. Hence money does not appear, as the form M–C–M requires, as the starting point, but always only as the result of exchange. It is the starting point only insofar as, from the seller’s side, the commodity counts for him only as price, as money that is merely supposed to be there, and he hurls it into circulation in this transitory form in order to withdraw it in its eternal form. Exchange-value was in fact the presupposition of circulation, hence money, and likewise its adequate existence and the increase thereof appear as the result of circulation, insofar as circulation ends in the accumulation of money.

Money, then, even in its concrete determination as money, in which it is itself already the negation of itself as mere measure and mere coin, is negated in the movement of circulation in which it was posited as money. But what is thereby negated is merely the abstract form in which the autonomisation of exchange-value—and the abstract form of the process of this autonomisation—appears in money. The whole of circulation, from the standpoint of exchange-value, is negated, since it does not carry within itself the principle of self-renewal.

Circulation proceeds from both aspects of the commodity, from it as use-value, from it as exchange-value. In so far as the first aspect predominates, it ends in the independence of the use-value; the commodity becomes an object of consumption. In so far as the second aspect predominates, it ends in the second aspect, the independence of the exchange-value. The commodity becomes money. But in the latter aspect it becomes money only through the process of circulation and continues to relate itself to circulation. In the latter aspect it develops further as objectified universal labour-time – in its social form. It is from this latter side, therefore, that the further determination of social labour must proceed, labour which originally appears as exchange-value of the commodity, then as money. Exchange-value is the social form as such; its further development therefore is the further development of the social process, or the deepening of the social process which casts the commodity onto its surface.

Let us proceed, as earlier from the commodity, now from exchange-value as such – its becoming independent is the result of the process of circulation – and we find:

1) Exchange-value exists twofold, as commodity and as money; the latter appears as its adequate form; but in the commodity, so long as it remains a commodity, money is not lost, but exists as its price. The existence of exchange-value is thus doubled, once in use-values, the other time in money. Both forms, however, are mutually exchanged, and through the mere exchange as such the value does not vanish.

2) In order for money to maintain itself as money, it must, just as it appears as a precipitate and result of the process of circulation, be capable of re-entering it, i.e., in circulation it must not become a mere means of circulation which, in the form of commodity, vanishes in exchange for mere use-value. Money, in entering into the one determination, must not lose itself in the other, thus in its existence as commodity it must remain money, and in its existence as money must exist only as a transitory form of the commodity; in its existence as commodity it must not lose exchange-value, and in its existence as money it must not lose its relation to use-value. Its entry into circulation must itself be a moment of its remaining-with-itself, and its remaining-with-itself an entry into circulation. Exchange-value is therefore now determined as a process, no longer as a merely vanishing form of use-value, indifferent to this use-value itself as material content, nor as a mere thing in the form of money; as relating itself to itself through the process of circulation. On the other hand, circulation itself is no longer a merely formal process in which the commodity runs through its different determinations; rather, exchange-value itself, namely exchange-value measured in money, must appear as a presupposition itself posited by circulation, and as posited by it, presupposed to it. Circulation itself must appear as a moment of the production of exchange-values (as a process of the production of exchange-values). In the independence of exchange-value in money, what is posited is, in fact, only its indifference towards the particular use-value in which it is incorporated. The independent universal equivalent is money, whether it exists in the form of commodity or in that of money. The independence in money must itself appear only as a moment of the movement, as a result indeed of circulation, but determined to begin it anew, not to persist in this form.

Money, i.e., independent exchange-value, which has emerged from the circulation process as a result and at the same time as the living drive of circulation (even if the latter only in the limited form of hoard formation), has negated itself as mere coin, i.e., as a merely vanishing form of exchange-value, as merely dissolved in circulation; it has likewise negated itself as confronting circulation as an independent thing. In order not to petrify as a hoard, it must just as much re-enter circulation as it emerged from it, but not as a mere means of circulation, rather its existence as means of circulation and therefore its conversion into commodity must itself be a mere change of form, in order to reappear in its adequate form, as adequate exchange-value, but at the same time as multiplied, augmented exchange-value, valorised exchange-value. The value that valorises itself in circulation, i.e., multiplies itself, is in general the exchange-value existing-for-itself, which runs through circulation as an end in itself. This valorisation, quantitative augmentation of value – the only process that value as such can undergo – appears in the accumulation of money only in opposition to circulation, i.e., through its own suspension. Circulation itself must rather be posited as the process in which it maintains and valorises itself. In circulation, however, money becomes coin and as such exchanges itself for commodity. If this change is now not to be merely formal – or the exchange-value not to be lost in the consumption of the commodity – so that only the form of exchange-value would be changed, once its universal abstract existence in money, the other time its existence in the particular use-value of the commodity – then exchange-value must in fact be exchanged against use-value and the commodity consumed as use-value, but must maintain itself as exchange-value in this consumption, or its disappearance must disappear and itself be only the means for the emergence of a larger exchange-value, for the reproduction and production of exchange-value – productive consumption, i.e., consumption through labour, in order to objectify labour, to posit exchange-value. Production of exchange-value is generally only production of a larger exchange-value, its multiplication. Its simple reproduction changes the use-value in which it exists, just as simple circulation does, produces it, does not create it.

Independent exchange-value presupposes circulation as a developed moment and appears as a constant process which posits circulation and constantly returns out of it into itself in order to posit it anew. Exchange-value as self-positing movement no longer appears as merely the formal movement of the presupposed exchange-values, but at the same time producing and reproducing itself. Production itself is here no longer present before its results, i.e., presupposed; rather it appears as simultaneously producing these results themselves; but it posits exchange-value no longer as merely leading to circulation, but as simultaneously presupposing developed circulation in its process.

In order to become independent, exchange-value would have to not only emerge from circulation as a result, but also be capable of re-entering it, of maintaining itself in it, as it becomes commodity. In money, exchange-value has obtained an independent form in opposition to circulation C–M–C, i.e., in opposition to its final dissolution into mere use-value. But only a negative, vanishing, or illusory one, if it is fixed. It exists only in relation to circulation and as the possibility of entering it. But it loses this determination as soon as it is realised. It falls back into its two functions as measure and means of circulation. As mere money it does not get beyond this determination. At the same time, however, it is also posited in circulation that money remains money, whether it exists as such or as price of the commodity. The movement of circulation must appear not as the movement of its disappearance, but rather as the movement of its actual self-positing as exchange-value, the realisation of exchange-value. When commodity is exchanged for money, the form of exchange-value, the exchange-value posited as exchange-value, money, persists only so long as it holds itself outside the exchange in which it functions as value, withdraws from it; hence it is a purely illusory realisation of it, purely ideal in this form in which the independence of exchange-value exists palpably.

The same exchange-value must become money, commodity, commodity, money, the requirement posited by the form M–C–M. In simple circulation the commodity becomes money and then commodity; it is another commodity that again posits itself as money. Exchange-value does not maintain itself in this change of its form. But it is already posited in circulation that money is both, money and commodity, and maintains itself in the change of both determinations.

In circulation, exchange-value appears twofold: once as commodity, the other time as money. When it is in the one determination, it is not in the other. This applies to every particular commodity; likewise to money as means of circulation. But considering the whole of circulation, it lies in the fact that the same exchange-value, exchange-value as subject, posits itself once as commodity, the other time as money, and that the movement is precisely to posit itself in this dual determination and to maintain itself in each of them as their opposite, in the commodity as money, and in money as commodity. This, which is present in itself in simple circulation, is, however, not posited in it.

Where in simple circulation the determinations comport themselves independently towards one another, positively, as in the commodity which becomes an object of consumption, it ceases to be a moment of the economic process; where negatively, as in money, it becomes madness, a derangement growing out of the economic process itself.

It cannot be said that exchange-value is realised in simple circulation, because use-value does not confront it as use-value determined by it, by exchange-value itself. Conversely, use-value as such does not itself become exchange-value, or becomes it only in so far as the determination of use-values – to be objectified universal labour – is applied to them as an external measure. Their unity still falls apart immediately, and their difference still immediately coincides. That use-value as such becomes through exchange-value, and that exchange-value mediates itself through use-value, must now be posited. In simple circulation we had only two formally distinct determinations of exchange-value – money and price of the commodity; and only two materially different use-values – C–C, for which money is only a vanishing mediation of exchange-value, a form which they momentarily assume. No real relation between exchange-value and use-value took place. In the use-value, exchange-value admittedly also exists as price (ideal determination); in money, use-value admittedly also exists, as its reality, its material. In the one case exchange-value was only ideal, in the other use-value was only material. The commodity as such – its particular use-value – is therefore also only a material motive for exchange, but as such falls outside the economic form determination; or the economic form determination is only a superficial form, a formal determination that does not penetrate the sphere of the real substance of wealth and does not relate to this substance at all; if, therefore, this form determination as such is to be held fast in the hoard, it transforms itself surreptitiously into a natural indifferent product, a metal, in which even the last relation to circulation is extinguished. Metal as such naturally expresses no social relation; the form of coin is also extinguished in it, the last life-sign of its social meaning.

Exchange-value, as presupposition and result of circulation, just as it has emerged from it, must just as much re-enter it.

We have already seen, in the case of money, and it appears in the formation of hoards, that the multiplication of money, its multiplication, is the sole process of the form of circulation in which value is an end in itself, i.e. that the value that has become autonomous and maintains itself in the form of exchange-value (initially money) is at the same time the process of its multiplication; that its preservation as value is at the same time its going beyond its quantitative barrier, its increase as magnitude of value, and that the autonomisation of exchange-value has no further content. The preservation of exchange-value as such by means of circulation appears at the same time as its self-multiplication, and this is | its self-valorisation, its active positing of itself as value-creating value, as value that reproduces itself and thereby preserves itself, but at the same time positing itself as value, i.e. as surplus-value. In the formation of hoards this process is still purely formal. To the extent that the individual is considered, it appears as a contentless movement that transforms wealth from a useful form into a useless one and one that is useless according to its purpose. To the extent that the economic process as a whole is considered, the formation of hoards serves only as one of the conditions of metallic circulation itself. As long as money remains a hoard, it does not function as exchange-value, it is merely imaginary. On the other hand, the multiplication – the positing of itself as value, the value that not only maintains itself through circulation but emerges from it, hence posits itself as surplus-value, is likewise only imaginary. The same magnitude of value that previously existed in the form of the commodity now exists in the form of money; it is accumulated in the latter form because in the other form it is renounced. If it is to be realised, it disappears in consumption. The preservation and multiplication of value is thus only abstract, formal. In simple circulation, only the form of the same is posited.

As the form of general wealth, autonomous exchange-value, money is capable of no other movement than a quantitative one: to multiply itself. According to its concept, it is the epitome of all use-values; but as always only a definite magnitude of value, a definite sum of gold and silver, its quantitative barrier stands in contradiction to its quality. It is therefore in its nature constantly to drive beyond its own barrier. (As enjoying wealth, e.g. in the Roman imperial period, it therefore appears as boundless, insane extravagance, which also seeks to raise enjoyment to its imaginary boundlessness, i.e. which, as this form of wealth, simultaneously treats it directly as use-value. Pearl salad, etc.) For the value that holds fast to itself as value, multiplication therefore coincides with self-preservation, and it preserves itself only by constantly driving beyond its quantitative barrier, which contradicts its inner universality. Enrichment is thus an end in itself. The teleologically determining activity of autonomous exchange-value can only be enrichment, i.e. the enlargement of itself; reproduction, but not merely formally, but so that it enlarges itself in reproduction. But as a quantitatively determined magnitude of value, money is also only the limited representative of general wealth, or the representative of a limited wealth, which reaches exactly as far as the magnitude of its exchange-value, is exactly measured by it. It therefore by no means has the capacity, which it is supposed to have according to its general concept, to buy all enjoyments, all commodities, the totality of material wealth; it is not a “précis de toutes les choses”3*.
 As wealth, held fast as the general form of wealth, as value that counts as value, it is therefore the constant drive to go beyond its quantitative barrier; an endless process. Its own vitality consists exclusively in this; it preserves itself only as value valid for itself, distinct from use-value, by constantly multiplying itself through the process of exchange itself. Active value is only surplus-value-positing value. The sole function as exchange-value is exchange itself. In this function it must therefore multiply, not by withdrawing from it, as in the formation of hoards. In the latter, money does not function as money. Withdrawn as a hoard, it functions neither as exchange-value nor as use-value, it is a dead, unproductive hoard. No action proceeds from it itself. Its multiplication is an external addition to it, in that new commodity is thrown into circulation and the value is translated from the form of the commodity into the form of money and then, as the latter, brought into safety, i.e. altogether ceases to be money. But if it enters circulation again, it disappears as exchange-value.

The money that results from circulation as adequate exchange-value and becomes autonomous, but re-enters circulation, perpetuates itself in and through it, valorises (multiplies) itself, is capital. In capital, money has lost its rigidity and has passed from a tangible thing into a process. Money and the commodity as such, just like simple circulation itself, now exist for capital only as particular abstract moments of its existence, in which it just as constantly appears, passes from one into the other, as it constantly disappears. The autonomisation appears not only in the form that it confronts circulation as autonomous abstract exchange-value – money – but that circulation is at the same time the process of its autonomisation; it emerges from it as something that has become autonomous.

In the form G–W–G it is expressly stated that the autonomisation of money as a process is to appear just as much as presupposition as it is as result of circulation. This form as such, however, receives no content in simple circulation, does not itself appear as a movement with content. A movement of circulation for which exchange-value is not only form but the content and end itself, and which therefore is the form of the processual exchange-value itself.

In simple circulation, the autonomous exchange-value, money as such, always appears only as result, caput mortuum 4* of the movement. It must just as much appear as its presupposition; its result as its presupposition, and its presupposition | as its result.

Money must maintain itself as money, both in its form as money and as commodity; and the exchange of these determinations, the process in which it passes through these metamorphoses, must simultaneously appear as its production process, as the creator of itself – i.e. multiplication of its magnitude of value. In that money becomes commodity, and the commodity as such is necessarily consumed as use-value, must perish, this perishing must itself perish, this consumption must consume itself, so that the consumption of the commodity as use-value itself appears as a moment of the process of value reproducing itself.

Money and commodity, as well as the relation of the two in circulation, now appear just as much as simple presuppositions of capital as, on the other hand, forms of existence of the same; just as much as simple, existing, elementary presuppositions for capital, as, on the other hand, themselves forms of existence and results of the same.

The imperishability that money strives for by relating negatively to circulation (withdrawing from it) is attained by capital precisely by preserving itself through abandoning itself to circulation. Capital, as the exchange-value that presupposes circulation, is presupposed to it, and maintains itself in it, alternately assumes both moments contained in simple circulation, but not as in simple circulation, where it merely passes from one of the forms into the other, but rather in each of the determinations it is at the same time the relation to the opposite. When it appears as money, this is now only the one-sided abstract expression of it as universality; in that it just as much strips off this form, it strips off only its antithetical determination (the antithetical form of universality). Posited as money, i.e. as this antithetical form of the universality of exchange-value, it is at the same time posited in it that it is not, as in simple circulation, to lose universality, but rather its antithetical determination, or assumes it only fleetingly, hence exchanges itself again for the commodity, but as a commodity which itself, in its particularity, expresses the universality of exchange-value, hence constantly changes its determinate form.

The commodity is not only exchange-value, but use-value, and as the latter it must be consumed purposively. In that the commodity serves as use-value, i.e. in its consumption, exchange-value must at the same time maintain itself, and appear as the teleologically determining soul of consumption. The process of its perishing must therefore at the same time appear as the process of the perishing of its perishing, i.e. as a reproductive process. The consumption of the commodity is therefore not directed towards immediate enjoyment, but is itself a moment of the reproduction of its exchange-value. Exchange-value thus yields not only the form of the commodity, but appears as the fire in which its substance itself goes up. This determination arises from the concept of use-value itself. In the form of money, however, capital will appear, on the one hand, only fleetingly as means of circulation, on the other hand as its being posited merely as a moment, in transience, in the determinateness of adequate exchange-value.

On the one hand, simple circulation is the existing presupposition of the commodity, and its extremes, money and commodity, appear as elementary presuppositions, forms that according to possibility become capital, or they are merely abstract spheres of the production process of the presupposed capital. On the other hand, they return into it as into their abyss or lead to the same. (Here the above historical example.)

In capital, money, the presupposed autonomous exchange-value, appears not merely as exchange-value, but as autonomous exchange-value as the result of circulation. And in fact no formation of capital takes place before the sphere of simple circulation, even if proceeding from entirely different conditions of production than capital itself, has developed to a certain height. On the other hand, money is posited as positing circulation as the movement of its own process, as the movement of its own realisation of the self-perpetuating and self-valorising value. As presupposition it is here at the same time result of the circulation process, and as result at the same time presupposition of the determinate form of the same, which was determined as G–W–G (initially only this current of the same). It is the unity of commodity and money, but the processual unity of both, and neither the one nor the other, just as much as the one and the other.

It maintains and valorises itself in and through circulation. On the other hand, exchange-value is presupposed no longer as simple exchange-value, as it exists as a simple determination of the commodity before it enters circulation, or as a merely intended determination, since it becomes exchange-value only fleetingly in circulation. It exists in the form of objectivity, but indifferent as to whether this objectivity is that of money or of the commodity. It comes out of circulation; hence it presupposes it; but at the same time it proceeds from itself as a presupposition confronting it.

In the actual exchange of money for commodity, as expressed in the form M–C–M, where therefore the real being of the commodity is its use-value, and the real existence of the use-value is its consumption, the exchange-value must itself re-emerge from the commodity that realises itself as use-value; money and the consumption of the commodity must appear equally as a form of its preservation and as a form of its self-valorisation. Circulation appears, in relation to money, as a moment of the process of its own realisation.

The real existence of the commodity, its existence as use-value, falls outside simple circulation. Hence the moment must enter into the process of capital in which the consumption of the commodity appears as a moment of its self-valorisation.

As long as money, i.e., the independent exchange-value, merely holds fast against its opposite, use-value as such, it is in fact capable only of an abstract existence. In its opposite, in its becoming use-value, and in the process of use-value, consumption, it must simultaneously preserve and increase itself as exchange-value, hence transform the consumption of use-value itself – the active negation as well as the positing of the same – into the reproduction and production of exchange-value itself.

In simple circulation each commodity appears alternately as exchange-value or as use-value. As soon as it is realised as the latter, it falls out of circulation. Insofar as the commodity is fixed as exchange-value, in money, it tends towards the same formlessness, but as something falling within the economic relation. In any case, commodities are of interest in the exchange relation (simple circulation) only insofar as they possess exchange-values. On the other hand, their exchange-value has only a transient interest, in that it cancels the one-sidedness of the use-value – of being a use-value existing immediately only for individuals – by bringing the use-value to the man; it changes nothing in the use-value other than positing it as use-value for others (the buyers). But insofar as exchange-value as such is fixed, in money, the use-value confronts it merely as abstract chaos; and precisely through its separation from its substance it collapses into itself and drives out of the sphere of simple exchange-value, whose highest movement is simple circulation and whose highest perfection is money. Within the sphere itself, however, the difference exists only as a formal, superficial distinction. Money in its highest fixedness is itself once again a commodity.

Foreign-language expressions

1*
coarseness

2*
of the possibility

3*
summation, meaning of all things. [Presumably a quotation from Boisguillebert]

4*
dead head

Foreign-language quotations

1
“Πλουτειν φασί σε παντες, εγώ δε φημί πένεσθαι

χρήσις γαρ πλούτου μάρτυς”

Karl Marx
Original text “Zur Kritik”
Third Chapter. Capital.

A. Production Process of Capital

1) Transformation of Money into Capital

As a result of simple circulation, capital exists initially in the simple form of money. The objective independence that it maintained as a hoard in this form against circulation has, however, vanished. Rather, in its existence as money, the adequate expression of the universal equivalent, all that is stated is that it is indifferent to the particularity of all commodities and can assume any desired commodity form. It is not this or that commodity, but can be metamorphosed into every commodity and continues in each of them to be the same magnitude of value and value relating to itself as an end in itself. The capital existing at first in the form of money neither remains standing over against circulation, therefore; it must, on the contrary, enter into it. Nor does it lose itself within circulation when it converts out of the money form into the commodity form. Its money existence is, rather, only its existence as the adequate exchange-value that can indifferently convert into every kind of commodity. In each it remains self-identical exchange-value. But capital can only be independent exchange-value by being independent over against a third thing, in a relation to a third thing. [[Its existence as money is both: It can exchange itself for any commodity whatever, and as universal exchange-value it is not bound to the particular substance of any commodity; secondly: It remains money even when it becomes commodity; i.e., the material in which it exists serves not as an object for the satisfaction of individual enjoyment, but as the materialisation of exchange-value, which assumes this form only in order to preserve and increase itself.]] This third thing is not the commodities. For capital is money that passes indifferently out of its form as money into that of every commodity, without losing itself in it as an object of individual consumption. Instead of excluding it, the entire circle of commodities, all commodities, appear as so many incarnations of money. As far as the natural material diversity of the commodities is concerned, none excludes money from taking its place within it, from making it its own body, since none excludes the determination of money in the commodity. The entire objective world of wealth now appears as the body of money, just as much as gold and silver, and the merely formal difference between money in the form of money and its difference in the form of commodity enables it equally to assume one or the other form, to pass from the form of money into that of commodity. (The independence consists only in the fact that exchange-value clings to itself as exchange-value, whether it exists in the money form or in the commodity form, and it passes over into the commodity form only in order to valorise itself.)

Money is now
objectified labour
, whether it possesses the form of money or of a particular commodity. No objective mode of existence of labour confronts capital; rather, each of them appears as a possible mode of existence of the latter, which it can assume by a simple change of form, transition from the form of money into the form of commodity. The sole opposite to
objectified
labour is
non-objective
labour, in contrast to
objectified
labour,
subjective
labour. Or, in contrast to temporally past but spatially existing labour, temporally present, living labour. As temporally present non-objective (and therefore also not yet objectified) labour, this can only exist as capacity, possibility, faculty, as the
labour capacity
of the living subject. Only living labour capacity itself can form the opposite to capital as the objectified labour that independently holds fast to itself, and thus the sole exchange through which money can become capital is the one that its possessor enters into with the possessor of living labour capacity, i.e., the worker.

As exchange-value, exchange-value in general can only become independent vis-à-vis the use-value that confronts it as such. Only in this relation can exchange-value as such become independent; be posited as such and function. In money, exchange-value was supposed to obtain this independence by abstracting from use-value, and the active abstraction, remaining in opposition to use-value, would here in fact appear as the only method of preserving and increasing exchange-value as such. By contrast, exchange-value is now supposed to preserve itself as exchange-value in its existence as use-value, in its real, not merely formal existence as use-value – to keep itself as exchange-value within the use-value as use-value, and to reproduce itself from it. The actual

existence of use-values is their real negation, their consumption, their destruction in consumption. It is, therefore, this their real negation as use-values, this negation immanent to them, in which exchange-value must prove itself true, as preserving itself against use-value, or rather making the active existence of the use-value into a confirmation of exchange-value. Not the negation in which exchange-value, as price, is a merely formal determination of use-value, in which the latter is ideally sublated but in fact only exchange-value appears on it as a vanishing formal determination. Nor its fixation in gold and silver, where a rigid, solid substance appears as the petrified existence of exchange-value. In fact, it is posited in money that use-value is mere materialisation, reality of exchange-value. But it is the merely imagined, palpable existence of its abstraction. However, in so far as use-value as use-value, i.e., the consumption of the commodity itself, is determined as the positing of exchange-value and as a mere means of positing it, the use-value of the commodity is in fact only the activation of the process-like exchange-value. The actual negation of the use-value, which does not exist in abstraction from it but in its consumption (not in the strained stance of standing still over against it), this its real negation, which is at the same time its realisation as use-value, must therefore be made into an act of self-affirmation, of self-activation of exchange-value. This, however, is possible only in so far as the commodity is consumed by labour, its consumption itself appearing as the objectification of labour and therefore as value-positing. Therefore, in order to preserve and activate itself not only formally, as in money, but in its real existence as commodity, the exchange-value objectified in money must appropriate labour itself, exchange itself with it.

Use-value is for money no longer an article of consumption in which it loses itself, but only the use-value through which it preserves and increases itself.
For money as capital, no other use-value exists.
This is precisely its behaviour as exchange-value towards use-value. The sole
use-value that can form an antithesis and complement to money as capital is labour,
and this exists in the labour capacity, which exists as subject. As capital, money is only in relation to non-capital, the negation of capital, in relation to which alone it is capital.
The real non-capital is labour itself.
The

first step by which money becomes capital is its exchange with labour capacity, in order by means of the latter to transform the consumption of commodities, i.e., their real positing and negation as use-values, at the same time into their activation of exchange-value.

The exchange through which money becomes capital cannot be exchange with commodities, but exchange with its conceptually determined opposite, the commodity that stands in a conceptually determined opposition to it – labour.

Exchange-value in the form of money is confronted by exchange-value in the form of a particular use-value. But all particular commodities, as particular modes of existence of objectified labour, are now equally expressions of exchange-value, into which money can pass over without losing itself. It is therefore not through exchange with these commodities, since it can now be presupposed indifferently that it exists in one form or another, that money could lose its simple character. But rather through exchange with, firstly, the sole form of use-value which it is not itself directly — namely non-objectified labour — and at the same time the immediate use-value for it as exchange-value in process — again labour. It is therefore only through the exchange of money with labour that its transformation into capital can take place.

The use-value against which money, as potential capital, can exchange can only be the use-value from which exchange-value itself comes into being, generates and multiplies itself. But this is only labour.

Exchange-value can realise itself as such only by confronting use-value — not this or that use-value — but use-value in relation to itself. This is labour. Labour capacity itself is the use-value whose consumption coincides immediately with the objectification of labour, hence with the positing of exchange-value. For money as capital, labour capacity is the immediate use-value against which it has to exchange. In simple circulation the content of the use-value was a matter of indifference, fell outside the economic form relation. Here it is an essential economic moment of the latter. In that exchange-value is at first determined as holding fast to itself in exchange only through exchanging with the use-value that confronts it according to its own formal determination.

The condition for the transformation of money into capital is that the owner of money can exchange money for alien labour capacity as a commodity. Hence that within circulation labour capacity is offered for sale as a commodity, for within simple circulation the exchanging persons confront each other only as buyers and sellers. The condition is therefore that the worker offers his labour capacity for sale as a commodity to be consumed: hence the free worker. The condition is that the worker, firstly, as free proprietor, disposes over his labour capacity, relates to it as a commodity; for this he must be its free proprietor. But secondly, that he no longer has to exchange his labour in the form of another commodity, objectified labour, but rather the only commodity he has to offer, to sell, is his living labour capacity, existing in his living corporeality; that the conditions for the objectification of his labour, the objective conditions of his labour, hence exist as alien property, as commodities located on the other side, beyond himself, in circulation. That the money-owner — or money, for for the time being the former is only the personification of the latter for us in the economic process itself — finds on the market, within the limits of circulation, labour capacity as a commodity, this presupposition from which we start here, and from which bourgeois society starts in its production process, is obviously the result of a long historical development, the résumé of many economic upheavals, and presupposes the downfall of other modes of production (social relations of production) and a definite development of the productive forces of social labour. The specific past historical process that is given in this presupposition will be formulated with still greater precision when the relation is considered further. This historical stage of development of economic production — whose product is already the free worker itself — is, however, the presupposition for the becoming and, even more, the existence of capital as such. Its existence is the result of a protracted historical process in the economic formation of society. At this point it is definitely shown how the dialectical form of presentation is only correct if it knows its limits. From the consideration of simple circulation we obtain the general concept of capital, because within the bourgeois mode of production simple circulation itself exists only as the presupposition of capital and as presupposing it. The result of this consideration does not turn capital into the incarnation of an eternal idea; but shows it, as it must in reality first, only as a necessary form, eventuate in exchange-value-positing labour, in production resting on exchange-value.

It is essential to hold firmly to this point, that the relation as it appears here as a simple circulation relation — initially still belonging entirely to it and only driven beyond the limits of simple circulation by the specific use-value of the commodities exchanged — is only the relation of money and commodity, of equivalents in the form of the two opposite poles, as they appear in simple circulation. Within circulation, and the exchange between capital and labour, as it itself exists as a mere circulation relation — is not the exchange between money and labour, but the exchange between money and living labour capacity. As use-value, labour capacity is realised only in the activity of labour itself, but in quite the same way as a bottle of wine which is bought, the use-value is first realised in the drinking of the wine. Labour itself falls as little within the simple circulation process as drinking. Wine as capacity, δυνάμει 1*,
is drinkable, and the purchase of wine is appropriation of the drinkable. So the purchase of labour capacity is power of disposition over labour. Since labour capacity exists in the living subject itself, and manifests itself only as its own expression of life, the purchase of labour capacity, the appropriation of the title to its use, naturally places buyer and seller during the act of use in a different relation than is the case with objectified labour, which exists as an object outside the producer. This does not detract from the simple exchange relation. It is only the specific nature of the use-value which is bought with money — namely that its consumption, the consumption of labour capacity, is production, objectifying labour time, exchange-value-positing consumption — its real existence as use-value is the creation of exchange-value — which makes the exchange between money and labour into the specific exchange M–C–M, in which exchange-value itself is posited as the purpose of the exchange and the purchased use-value is directly use-value for exchange-value, i.e., value-positing use-value. It is a matter of indifference whether money is considered here as a simple means of circulation (means of purchase) or as a means of payment.

Insofar as someone who, e.g., sells me the 12-hour use-value of his labour capacity, sells me his labour capacity for 12 hours, has in fact only sold it to me once he has worked 12 hours if I insist on it, has only delivered his labour capacity for 12 hours to me at the end of the 12 hours, it lies in the nature of the relation that money here appears as means of payment; purchase and sale are not realised directly and simultaneously on both sides. The only important thing here is that the means of payment, the general means of payment, is money, and the worker therefore does not enter into other than circulation relations with the buyer through a particular, naturally evolved mode of payment. He transforms his labour capacity directly into the general equivalent, as the owner of which he maintains the same relation — the magnitude of his value magnitude — the same relation in general circulation, like everyone else; and likewise general wealth, wealth in its general social form and as the possibility of all enjoyments, is the purpose of his sale. [2]