1) THE TRANSFORMATION OF MONEY INTO CAPITAL 

As a result of the simple circulation, capital exists above all in 
the simple form of money. However, the reified independence 
which holds it down in this form as hoard, as opposed to 
circulation, has disappeared. On the contrary, the being of capital 
in the form of money, adequate expression of the universal 
equivalent, merely implies that it is indifferent to the particularity 
of all the commodities and can assume the form of any commodity 
whatsoever. It is not this or that commodity, but can be 
metamorphosed into any commodity and continues to be in each 
of them the self-same value magnitude and to-itself-related value 
as its own end. Existing above all in the form of money, capital 
does not, therefore, remain opposed to circulation; on the 
contrary, it must enter into it. Nor is it lost within circulation as it 
passes from the form of money to the form of commodity. Its 
being as money is rather only its being as adequate exchange value 
which can pass into any commodity whatsoever. In any of these, it 
remains self-sufficient exchange value. But the exchange value 
become independent can be capital only when capital itself is 
established with respect to a third, in a certain relationship with a 
third. 

//Its being in the form of money is two-fold: it can exchange 
itself for any commodity whatsoever, and, as universal exchange 
value, is not tied to the particular substance of any commodity; 
secondly, it remains money even when it becomes commodity; in 
other words, the material in which it exists is not an object for 
individual gratification, but materialisation of the exchange value 
which assumes this form only so as to preserve and expand itself.// 

This third is not commodities. For capital is money which from 
its form of money passes into any form of commodity whatsoever, 
without being lost within it as an object of individual consumption. 
Instead of excluding money, the whole range of commodities, all 
commodities, appear as so many incarnations of money. As for the 
natural physical difference between the commodities, none pre- 
vents money from taking its place within it and making it a part of 
its own body, since none of them excludes the determination of 
money in the commodity. The whole reified world of wealth now 
appears as the body of money in the same way as gold and silver, 
and it is merely the formal difference between money in the form 
of money, and money in the form of commodity that makes it 
capable of equally assuming the one form or the other, and 
passing from the form of money into the form of commodity. 
(The process of becoming independent already consists in that the 
exchange value firmly maintains itself as exchange value, whether 
it exists in the form of money or in the form of commodity, and it 
passes into the form of commodity only in order to valorise itself.) 

Money is now objectified labour, irrespective of whether it 
possesses the form of money or of a particular commodity. None 
of the reified modes of being of labour confronts capital, but each 
of them appears as a possible mode of its existence which it can 
assume through a simple change of form, passage from the form 
of money into the form of commodity. The only opposite of 
reified labour is unreified labour, and the opposite of objectified 
labour, subjective labour. Or, the opposite of past labour, which 
exists in space, is living labour, which exists in time. As the 
presently existing unreified (and so also not yet objectified) labour, 
it can be present only as the power, potentiality, ability, as the 
labour capacity of the living subject. The opposite of capital as the 
independent, firmly self-sufficient objectified labour is_ living 
labour capacity itself, and so the only exchange by means of which 
money can become capital is the exchange between the possessor 
of capital and the possessor of the living labour capacity, i.e. the 
worker. 

The exchange value can become independent as exchange value 
in general only with respect to the use value confronting it as 
such. Only within the framework of this relationship can exchange 
value establish itself as such, as such be posited and function. In 
money, the exchange value should retain this independence 
through an abstraction from the use value, and this active 
abstraction—remaining in opposition to use value—would here in 
effect appear as the sole method for preserving and augmenting 

the exchange value as such. Now, however, the exchange value, in 
its being as use value, in its real, and not only formal being as use 
value, must preserve itself as exchange value—as exchange value 
in use value as use value—and create itself out of it. The real 
being of use values is their real negation, their absorption, their 
annihilation in consumption. Consequently, it is in this their real 
negation as use values, in this negation immanent to themselves 
[B”-17] that the exchange value must certify itself as maintaining 
itself with respect to the use value, or, rather, make the active 
being of the use value the confirmation of the exchange value. It 
is not a negation in which the exchange value as price is merely a 
formal determination of the use value in which the latter 1s 
notionally sublated, while actually the exchange value only appears 
as a fleeting formal determination of the use value. Nor is it its 
fixation in gold and silver where a hard-and-fast substance 
appears as a petrified being of the exchange value. In actual fact, 
it is posited in money that the use value is mere materialisation, 
reality of the exchange value. But this is merely an imaginary 
tangible existence of its abstraction. But in so far as the use value 
as use value, i.e. the consumption of the commodity. itself, 
determined as the positing of the exchange value and as a mere 
means for positing it, the use value of the commodity is, in fact, 
the actualisation of the exchange-value-in-process. The real 
negation of the use value which exists not in an abstraction from it 
(not in a stoppage tensely opposed to it) but in its consumption, 
this real negation of it, which is at the same time its actualisation 
as use value, must for that reason become an act of self-assertion, 
self-actualisation of the exchange value. But this is possible only in 
so far as the commodity is consumed by labour, in so far as its 
consumption itself appears as the objectification of labour and so 
as the creation of value. That is why if it is to preserve and 
actualise itself, not only formally, as in money, but also in its real 
existence as commodity, the exchange value objectified in money 
must appropriate labour itself, exchange itself for it. 

For money, use value is now no longer an article of consump- 
tion in which it loses itself, but only a use value through which it 
preserves and increases itself. No other use value exists for money as 
capital. That is precisely the relation of capital as exchange value 
to use value. Labour is the only use value which can present an 
opposite and a complement to money as capital, and it exists in labour 
capacity, which exists as a subject. Money exists as capital only in 
connection with non-capital, the negation of capital, in relation to 
which alone it is capital. Labour itself is the real non-capital. The first 

step made by money to become capital is its exchange with the 
labour capacity so as by means of the latter to transform the 
consumption of the commodities, i.e. their real positing and 
negation as use values, simultaneously into their actualisation of 
exchange value. 

The exchange through which money becomes capital cannot be 
its exchange with commodities [in general] but can only be one 
with its conceptually determined opposite, the commodity which is 
itself a conceptually determined opposite of it—labour. 

‘The exchange value in the form of money confronts the 
exchange value in the form of the particular use value. But all 
particular commodities, as particular modes of the being of 
objectified labour, are equally expressions of the exchange value 
into which money can pass without being lost. It is, therefore, not 
through the exchange with these commodities, since it can now 
equally be assumed that it exists in the one form or the other, that 
money can lose its simple character. But through the exchange, first 
with the only form of use value which it is not immediately 
itsel{—namely, unreified labour—and simultaneously with the 
immediate use value which is exchange-value-in-process for it— 
labour once again. It is, therefore, only through the exchange of 
money with labour that its transformation into capital can be 
effected. The use value for which money as potential capital can 
exchange itself can only be the use value out of which the exchange value 
itself arises, produces itself and multiplies. And this is labour alone. 

The exchange value can realise itself as such only by confront- 
ing the use value—not this or that—but the use value correlated 
to itself. This is labour. Labour capacity itself is the use value 
whose consumption directly coincides with the objectification of 
labour, i.e. the creation of the exchange value. For money as 
capital, labour capacity is the immediate use value for which it has 
to exchange itself. In the simple circulation, the content of the use 
value was indifferent, [B”-18] dropped out of the economic 
determination of form. Here it is its essential economic moment. 
For the exchange value is determined as firmly established in 
exchange above all because it is exchanged with a use value 
confronting it in its own form determination. 

The condition for the transformation of money into capital is 
that the owner of the money can exchange money for the alien 
labour capacity as a commodity. In other words, that within 
circulation the labour capacity is offered as a commodity for sale, 
since within the simple circulation the exchangers confront each 
other only as buyers and sellers. The condition is, therefore, that 

the worker offers for sale his labour capacity as a to-be-used 
commodity and, so, is a free worker. The condition is that the 
worker, first, disposes of his labour capacity as a free proprietor, 
and treats it as a commodity; to do so he must be a free proprietor 
of his labour capacity. And second, that he must exchange his 
labour no longer in the form of another commodity, of objectified 
labour, but so that the only commodity he has to offer, to sell, is 
his own living labour capacity contained in his living corporeality, 
and that, consequently, the conditions for the objectification of his 
labour, the reified conditions of his labour exist on the other side 
of circulation as alien property, as commodities located beyond his 
own self. 

That the possessor of money—or money, since the former is for 
us so far only its personification in the economic process 
itself — finds the labour capacity on the market, within the limits of 
circulation, as a commodity, this premiss from which we here 
proceed and from which the bourgeois society proceeds in its 
production process is evidently the result of long historical 
development, the outcome of many economic upheavals, and 
implies the decline of other modes of production (other social 
relationships of production) and a determined development of the 
productive forces of social Jabour. The determined past historical 
process contained in that premiss will be formulated even more 
determinately in the subsequent examination of this relationship. 
But this historical stage in the development of economic produc- 
tion —whose product itself is already the free worker—is the premiss 
for the emergence and even more so for the being of capital as 
such. Its existence is the result of a lengthy historical process in 
the economic formation of the society. 

It is made quite definite at this point that the dialectical form of 
presentation is right only when it knows its own limits. The 
examination of the simple circulation shows us the general concept 
of capital, because within the bourgeois mode of production the 
simple circulation itself exists only as preposited by capital and as 
prepositing it. The exposition of the general concept of capital 
does not make it an incarnation of some eternal idea, but shows 
how in actual reality, merely as a necessary form, it has yet [B”-19] 
to flow into the labour creating exchange value, into production 
resting on exchange value. 

It is essentially important to establish the point that the 
relationship, which here takes place as a simple relationship of 
circulation (initially still entirely belonging to it and going beyond 
the limits of the simple circulation only through the specific use 

value of the exchanged commodity), is only a relationship of 
money and commodity, equivalents in the form of both opposite 
poles as they appear in the simple circulation, within circulation, 
and that the exchange between capital and labour, once it itself 
exists as the simple relationship of circulation, is not the exchange 
between money and labour, but the exchange between money and 
living labour capacity. 

As use value, the labour capacity is realised only in the activity 
of labour itself, but in much the same way as with a bottle of wine 
which is bought and whose use value is realised only in the 
drinking of the wine. Labour itself falls as little within the simple 
circulation process as does the drinking. The wine as a capacity, 
Svvawer,* is something drinkable, and the buying of the wine is 
appropriation of the drinkable. So is the buying of the labour 
capacity the appropriation of the ability to dispose over the labour. 

Since the labour capacity exists in the vitality of the subject itself 
and manifests itself only as his own expression of life, the buying 
of the labour capacity, the appropriation of the title to its use 
naturally places the buyer and the seller in the act of its use in 
another relationship to each other than that in the buying of 
objectified labour existing as an object outside the producer. This 
does not affect the simple relationship of exchange. It is only the 
specific nature of the use value bought with the money—namely, 
that its consumption, the consumption of the labour capacity, is 
production, labour time which objectifies, consumption which 
posits exchange value; that its real being as use value is creation of 
exchange value—that makes the exchange between money and 
labour the specific exchange M-—-C—M in which the exchange 
value itself is posited as the aim of the exchange, and the bought use 
value is immediate use value for the exchange value, i.e. is value-positing 
use value. 

It does not matter whether money is considered here as simple 
means of circulation (means of purchase) or as means of payment. 
In so far as someone selling me, for instance, the 12-hour use 
value of his labour capacity, his labour capacity for 12 hours, will 
in fact sell it to me only when, if I so insist, he has worked off 12 
hours, i.e. has delivered his labour capacity sold for 12 hours at 
the end of the 12 hours, it is in the nature of this relationship that 
money here appears as means of payment; the buying and selling 
are not realised at once, simultaneously, by both sides. What is 
here important is only that the means of payment is the universal 

means of payment, money, and that for this reason the worker does 
not enter with the buyer—as a result of some particular primitive 
way of payment—into other relationships than those of circula- 
tion. He transforms his labour capacity immediately into the 
universal equivalent, and as its possessor maintains the same 
relationship—within the scope of its value magnitude—the same 
relationship in the general circulation as any other; similarly, the 
aim of his sale is universal wealth, wealth in its universal social 
form and as a possibility of all gratification.*