By FERNANDO RUGITSKY*
Excerpt from Presentation of the new edition of Karl Marx's book.
The capital is commonly read from the perspective of the Marxist tradition that it inaugurated and of the debates within socialist movements. Although such debates have often resulted in vulgarizations and simplistic schemes, they have at the same time allowed Karl Marx's work to be kept alive, promoting an uninterrupted dialogue between the conceptual apparatus developed by the author and the dynamic reality of capitalist societies.
However, the scope of The capital is much larger. The book occupies a prominent place in modern thought that goes beyond its theoretical affiliations and political perspective. A place similar to that occupied by another book also published in the third quarter of the 19th century, The origin of species, by Charles Darwin. Both provoked intense debate, formed countless disciples and offered a revolutionary way of interpreting the world – in other words, “they became fundamental to all modern culture”.
The similarity did not go unnoticed. Karl Marx himself referred to Charles Darwin's book as "the basis of natural science from our point of view", and Friedrich Engels, in 1883, in a speech given at the funeral of his great collaborator, stated: "Just as Darwin discovered the law of development of organic nature, so Marx discovered the law of development of human history."
But the parallel should not be taken too far. The Origin of Species sold out its first print run in a single day, and its ideas quickly established themselves as one of the main starting points for the Natural Sciences. Capital, in turn, cost much more to spread and to disseminate the reputation of its author. Furthermore, although inescapable, the work is more commonly rejected than adopted as one of the foundations of contemporary Social Sciences.
Why, then, reread The capital, more than a century and a half after the first publication of its first volume? Because the book still holds enormous potential to illuminate contemporary socioeconomic transformations that have challenged traditional Social Sciences, broadening the perspective of analysis of current dilemmas and offering horizons beyond the paralyzing impasses of the present crises.
Its uneven and tortuous reception is not due to any limitations of the book, but is a symptom of the conflicts inherent in the mode of production that Marx helped to dissect. Furthermore, for a long time his work was read under the shadow of the conflicts surrounding the Cold War, the mystification of the author by some of his followers, and his demonization by his detractors.
Paradoxically, at a time when political challenges to capitalist hegemony are relatively weaker, an opportunity is created to reread the book on its own terms, without the constraints imposed by the disputes of interpretation that marked its reception. A re-encounter that can question, in a new historical moment, what Capital has to offer to the questions of the present.
Of course, this reinterpretation can only take shape if the forms of resistance to capitalist domination acquire sufficient strength to “transform the world.” After all, as Marx argued in his famous eleventh thesis, interpreting the world is only the first step. Capital is not only Marx’s major work, but also, as regards its first volume, one of the few books he published during his lifetime.
Most of his work was published posthumously and, in many cases, consists of texts with varying degrees of completion. The first volume of The capital, however, was the result of years of work, revision and polishing. It is difficult to think of a work similar in terms of boldness, scope and richness of detail. It combines an extensive and rigorous conceptual effort with innovative and detailed historical reconstructions. Marx effectively sought to articulate the body of thought that preceded him, taking his contributions forward.
As David Harvey summed it up: “Shakespeare, the Greeks, Faust, Balzac, Shelley, fairy tales, werewolves, vampires, and poetry—all of these are found in its pages, along with countless political economists, philosophers, anthropologists, journalists, and political scientists.” The work he produced made Karl Marx the true “heir to the classical economists and philosophers” and to the tradition that stretches back “to the intellectual development of the Renaissance.”
The following sections briefly introduce the book’s argument. In the first two, the conceptual framework developed in the first four chapters of Book 1 is elucidated in the light of the contrast between Marx and the classical political economists. The following three sections analyze how the author used these concepts to offer an interpretation of the dynamics of capitalist societies, their “laws of motion.” The focus is then divided between the arguments presented in the book and their relevance to the present.
Smith, Ricardo and the greatness of value
The capital It was a settling of accounts with the so-called classical political economy, the tradition of thought that emerged alongside industrial capitalism and whose main representatives were Adam Smith and David Ricardo. Born in Germany in 1818, Marx began his intellectual formation in intense dialogue with German philosophy, in particular with Hegel and his followers.
Later, his political education would be forged in heated debates with French socialists. From the 1850s onwards, then in his early thirties, he began to dedicate himself to a systematic study of classical political economy. German philosophy, French socialism and British political economy would form the basic tripod of his education and work. The capital, as its subtitle indicates, brought the critique of Political Economy to the forefront.
Its starting point is in the first four chapters of Book 1, in which the critique of classical value theory is formulated. Value theory, especially in Smith and Ricardo, resulted from the efforts of these authors to understand the dynamics of capitalism that was emerging around them. Behind a sometimes hermetic exercise in order to illuminate the relative prices of commodities, there was hidden an effort to unveil, as Marx would write in 1859, “the anatomy of bourgeois society”.
The aim was to understand the functioning of a society that had come to depend on the exchange of goods for the greater part of its material reproduction. The historical rupture that this represented should not be underestimated. Throughout previous human history, from the first hunter-gatherer groups up to the eighteenth century, the daily guarantee of material reproduction depended crucially on production for consumption itself.
Only the ruling classes in class societies did not engage in production for their own subsistence, ensuring their reproduction by expropriating part of what was produced by the subordinate classes. Food, clothing, housing – almost everything was produced for their own consumption or that of the ruling classes, and only exceptionally was something fundamental for material reproduction obtained in a commodity transaction. Markets have evidently existed for a long time, as has the exchange of products between different communities.
“The novelty represented by the capitalist mode of production was to subordinate the greater part of the material reproduction of society to mercantile exchanges. One of the main people responsible for emphasizing this novelty was Karl Polanyi. According to him, until the time of Adam Smith, this propensity [to bargain, barter and exchange one thing for another] had not manifested itself on any considerable scale in the life of any community studied and, at most, remained a subordinate aspect of economic life. A hundred years later, however, an industrial system was already in full operation in most of the planet and, practically and theoretically, this meant that the human race had been shaken in all its economic activities, if not also in its political, intellectual and spiritual pursuits, by this particular propensity.”
Marx referred to this novelty in the opening of Capital: “The wealth of societies in which the capitalist mode of production dominates appears as an 'immense collection of commodities', and the individual commodity as its elementary form”. Only with the consolidation of this mode of production does the product of human labor assume the form of a “commodity”, that is, something produced to be sold.
Consequently, the crucial question for understanding this society concerned social coordination: how could it be possible to ensure that relatively decentralized decisions about what to produce and what to consume could be reconciled, ensuring the material reproduction of society, even if in a way that was often precarious and always unequal? How could it be guaranteed that a sufficient part of society would dedicate itself to producing the products that would feed everyone, for example? Or to producing the clothes that they would wear?
This is precisely the background to Adam Smith's formulation that “our dinner” does not depend on “the benevolence of the butcher, the brewer, or the baker,” but “on their regard to their own interest.”
The formulation of a theory of value by classical political economists aimed to address this issue. Determining the values at which commodities are exchanged involves economic processes that ensure the complex task of social coordination of production, dynamically ensuring that social production adjusts to the material reproduction requirements of society as a whole, even in the midst of continuous crises and imbalances.
A one-off imbalance, such as insufficient production of a certain food (due to harvest problems, for example), raises the price of that product, stimulating an increase in its production. Producers from other sectors may move to that sector in search of higher income. The opposite process would occur with an imbalance in the other direction, in the case of excessive production.
In this way, fluctuations in market prices trigger adjustments in the quantity produced by different sectors, functioning as an impersonal mechanism of social coordination. Smith's formulation was based on the distinction between market price and natural price. The latter is defined as “the central price around which the [market] prices of all commodities continually gravitate.”
The Scottish thinker was left to define how natural prices are determined and thus arrive at the basis for the process of social coordination. This is the core of the theory of value. In reality, however, he gave two distinct answers, that is, he formulated two theories of value.
The first of these, which would apply only to the “ancient and primitive stage preceding the accumulation of wealth or capital and the appropriation of land”, stated that labor would be “the ultimate and real standard on the basis of which the value of all commodities can always and everywhere be estimated and compared”.
Adam Smith then concluded that “labor is the real price of commodities.” Hence, his theory is sometimes called the labor theory of value. A different theory, however, would apply to “more evolved societies,” since in them the value obtained from the sale of commodities would not only compensate for the labor expended in their production, but also for the capital invested and the land used.
For such societies, Adam Smith formulated an additive theory of value, according to which the value of goods would result from the sum of wages, profits and land rent. In both societies, the natural price, determined by labor or by the sum of wages (as the case may be), would act as a gravitational pole, structuring the exchange processes and, through them, the social distribution of production and labor.
This laid the conceptual foundation that would be critically appropriated, in different ways, by David Ricardo and Karl Marx. David Ricardo noted that, even at the most primitive stage of society, it is unreasonable to suppose that people dispensed with the use of capital for their activities. A prehistoric hunter probably needed some weapon, that is, some capital, to “enable him to kill his prey.”
Even if he himself produced his weapon, the value of his game would not be determined entirely by the labor time directly spent on the final activity – hunting – but would also be influenced by the labor time needed to produce the weapon. Let us say that the average time needed to hunt a deer and a beaver, examples used by David Ricardo himself, were the same. This would not imply that a deer could be exchanged for a beaver, since the hours spent producing the appropriate weapons to hunt each of the animals could have been different.
Thus, even for the “primitive stage,” it would be necessary to formulate a theory of value that took into account both the labor directly employed in production and that embedded in the tools used in the production process. With this argument, David Ricardo rejected Adam Smith’s formulation that it would be necessary to develop more than one theory of value, each one appropriate for a different stage of development of societies. In the first chapter of his main book, he set himself the challenge of explaining the determination of the value of commodities by the labor time incorporated in them (directly and indirectly), based on the recognition that production is only exceptionally carried out with labor alone, but generally relies on some form of capital.
Thus, David Ricardo generalized the theory that Adam Smith formulated for the “primitive stage of societies”. The theoretical challenge involved was, in fact, enormous. So much so that the subject did not end with Ricardo’s formulation and is still debated intensely today, being one of the main themes that occupied the economist Piero Sraffa and his followers, largely responsible for renewing Ricardo’s legacy. The publication of the book Production of goods by means of goods, by Piero Sraffa, in 1960, generated numerous debates involving economists of different theoretical affiliations, including Marxists, and inaugurated a new tradition of thought, Sraffian or neo-Ricardian.
Furthermore, the long Marxist debate on the so-called “problem of the transformation” of values into prices of production, which takes as its starting point the effort made by Marx himself to meet the challenge posed by David Ricardo (in sections i and ii of Book 3 of The capital, chapters 1 to 12), deals with the same issue.
In short, assuming that capital mobility between sectors produces a tendency towards equalization of profit rates and that different sectors employ different volumes of capital in relation to the labor directly used, the relative prices between goods deviate, albeit moderately, from the ratio between the labor times (direct and indirect) employed in their production.
To use the expressions consecrated by Marx, there would thus be a distinction between values (exclusively determined by the embodied labor time) and production prices (which take into account the tendency towards equalization of the rate of profit). The controversy initiated by this observation divided those who considered that such a deviation contradicted the principle that labor determined the value of commodities and those who claimed that it merely implied a sophistication of the theory founded on this principle.
Both David Ricardo and Piero Sraffa's search for an “invariable measure of value” and the different proposed solutions to the “transformation problem” thus represented a defense of the labor theory of value.
Returning to David Ricardo, his decision to reject Smith’s additive theory of value and generalize the labor theory of value had a decisive implication: it brought to the fore the issue of exploitation. In Adam Smith, the labor time embodied in the production of commodities and the remuneration for this labor are taken as equivalent, so that the labor theory of value must be abandoned in “more evolved societies” precisely because in them the value of the commodity is not exhausted by wages, but must also include profits and land rent.
The additive theory of value would be appropriated by later literature precisely as a legitimation of the three types of income, against the idea of exploitation. It thus represented a theoretical basis for arguing that labor, capital, and land contributed to production and would be remunerated proportionally. By insisting that, even when capital is used, the value of commodities continues to be determined by the labor time involved in their production, David Ricardo makes it clear that the wages paid to workers represent only a part of the value created by them.
It was not in David Ricardo's plans to formulate a theory of exploitation, but such an implication of his work was not accidental either. Writing more than four decades after Adam Smith, when the Industrial Revolution was already more advanced in England and its social and political tensions had emerged, David Ricardo does not underestimate the centrality of class conflicts.
In reality, his formulation of the theory of value arose from a practical political intervention, that is, from his defense of the abolition of the so-called Corn Laws, the central conflict that divided the emerging bourgeoisie and the landowners in the first half of the 1815th century in England. In an essay written in 1817 on the subject and which would lay the basis for his main theoretical book, originally published in XNUMX, David Ricardo did not mince words: “the interest of the landowner is always opposed to the interest of all the other classes of society.”
His rigorous and obsessive effort to elucidate the determination of the value of commodities was paralleled by his awareness of the centrality of class conflicts. In the preface to the principles, he argued that explaining the division of production between landowners, capitalists, and workers was “the main question of Political Economy.”
*Fernando Rugitsky is professor of economics at the University of the West of England, Bristol, and co-director of Bristol Research in Economics.
Reference
Karl Marx. Capital: critique of political economy. Translation: Flávio R. Kothe & Regis Barbosa. New York, New York, 2025, 2384 pages. [https://amzn.to/3FCt52w]
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