Lucio Colletti

Bernstein and the Marxism of the Second International

T H E  L A B O U R  T H E O R Y  O F  V A L U E

The inadequacy and simplification of the concept of 'economy', which, as we have seen, is an element more or less common to all the tendencies of Marxism in the Second International, helps to explain the foundation, during the same period, of an interpretation of the labour theory of value from which even later Marxism has been unable to free itself. This interpretation consisted in the reduction of Marx's theory of value to that of Ricardo, or even to the theory of value which developed in the course of the 'dissolution of the Ricardian school'. Its hallmark is the inability to grasp, or even to suspect, that Marx's theory of value is identical to his theory of fetishism and that it is precisely by virtue of this element (in which the crucial importance of the relation with Hegel is intuitively evident) that Marx's theory differs in principle from the whole of classical political economy.

    'Political economy has indeed analysed, however incompletely, value and its magnitude and has discovered what lies beneath these forms. But it has never once asked the question why labour is represented by the value of its product and labour-time by the magnitude of that value .'[77]

    The achievement and the limitation of classical political economy are indicated here with extraordinary clarity. First, the achievement: political economy, in spite of its incompleteness and its various inconsistencies, understood that the value of commodities is determined by the labour incorporated in them, or, in other words, that what appears as the 'value' of 'things' is in reality (here is 'the content hidden in the form') the 'human labour' necessary for their production. Second, the limitation: it never posed the problem of why that content assumes this particular form, why human labour takes on the form of value of things, or, in short, on the basis of what historical-social conditions the product of labour takes the form of a commodity. This problem could not be posed by political economy, since, Marx goes on to explain, the economists could not see that 'the value-form of the product of labour is not only the most abstract but is also the most universal form taken by the product in bourgeois production'. They wrongly held instead that the production of commodities, far from being a historical phenomenon, was a 'self-evident necessity imposed by nature'.[71] They believed, in other words, that there could be no production in society without this production being production of commodities, that in all societies the product of human labour must necessarily assume this form.[72]

    The main consequence of this different approach is as follows. Classical political economy, taking the existence of the commodity as a 'natural' and hence non-problematical fact, restricted itself to investigating the proportions in which commodities exchange for one another, concentrating their analysis on exchange value rather than value in the strict sense: 'The analysis of the magnitude of value almost completely absorbs the attention of Smith and Ricardo,' Marx wrote.[73] For Marx, on the contrary, the essential problem, prior to that of exchange rates of commodities is to explain why the product of labour takes the form of the commodity, why 'human labour' appears as a 'value' of 'things'. Hence the decisive importance for him of his analysis of 'fetishism', 'alienation' or 'reification' (Verdinglichung ): the process whereby, while subjective human or social labour is represented in the form of a quality intrinsic in things, these things themselves, endowed with their own subjective, social qualities, appear 'personified' or 'animated', as if they were independent subjects.

    Marx writes:

Where labour is in common, relations between men in their social production are not represented as 'value' of 'things'. Exchanges of products as commodities is a certain method of exchanging labour, and of the dependence of the labour of each upon the labour of the others, a certain mode of social labour or social production. In the first part of my work I have explained that it is characteristic of labour based on private exchange that the social character of the labour is 'represented' as a 'property' of the things; and inversely, that a social relation appears as a relation of one thing to another (of products, values in use, commodities).[74]

    Marx explained the operation of this exchange of the subjective with the objective and vice versa -- in which the fetishism of commodities consists -- with his celebrated concept of 'abstract labour ' or 'average human labour '. Abstract labour is what is equal and common to all concrete human labouring activities (carpentry, weaving, spinning, etc.) when their activities are considered apart from the real objects (or use-values) to which they are applied and in terms of which they are diversified. If one abstracts from the material to which labour is applied, one also abstracts, according to Marx, from the determination of productive activity, that is from the concrete character that differentiates the various forms of useful labour. Once this abstraction is made, all that remains of all the various sorts of labour is the fact that they are all expenditures of human labour power. 'Tailoring and weaving, though qualitatively different productive activities, are each a productive expenditure of human brains, nerves and muscles, and in this sense are human labour.'[75] It is this equal or abstract human labour -- labour considered as the expenditure and objectification of undifferentiated human labour-power, independently of the concrete forms of activity in which it is realized -- that produces value. Value is 'a mere congelation of homogeneous human labour, of labour-power expended without regard to the form of its expenditure'. As products of abstract labour, all the products of concrete forms of labour lose their perceptible or real qualities and now represent only the fact that 'human labour-power has been expended in their production, that human labour is embodied in them; . . . as crystals of this social substance, common to them all, they are -- Values.'[76]

    The point to be emphasized here is that not only Marx's critics, but indeed his own disciples and followers -- and not only those of the Second International but also more recent ones, to this very day -- have all shown themselves incapable of understanding or realizing fully the significance of this concept. 'Abstract labour' seems at least to be a perfectly straightforward and clear notion. And yet neither Kautsky in his Economic Doctrines of K. Marx [77] nor Hilferding in his important reply to Böhm-Bawerk,[78] nor Luxemburg in her ample Introduction to Political Economy,[79] nor Lenin and tutti quanti, have ever really confronted this 'key' to the entire theory of value. Sweezy, who has gone further than most, writes: 'Abstract labour is abstract only in the quite straightforward sense that all special characteristics which differentiate one kind of labour from another are ignored. Abstract labour, in short, is, as Marx's usage quite clearly attests, equivalent to "labour in general"; it is what is common to all productive human activity.'[80]

    The meaning of this argument is clear. 'Abstract labour' is an abstraction, in the sense that it is a mental generalization of the multiplicity of useful, concrete kinds of labour: it is the general, common element of all these kinds of labour. This generalization, moreover, as Sweezy goes on to point out, corresponds to capitalist reality, in that in this kind of society labour is shifted or diverted according to the direction of capital investments; hence a determinate portion of human labour is, in accordance with variations of demand, at one time supplied in one form, at another time in another form. This proves the secondary importance in this regime of the various specific kinds of labour, as against labour in general or in and for itself. In spite of Sweezy's plea that 'the reduction of all labour to a common denominator . . . is not an arbitrary abstraction, dictated in some way by the whim of the investigator' but 'rather, as Lukács correctly observes, an abstraction "which belongs to the essence of Capitalism",'[81] despite this, in the absence of what seems to me the decisive point, 'abstract labour' remains, in the last analysis, essentially a mental generalization.

    The defect of this interpretation of 'abstract labour' lies not only in the fact that -- if abstract labour is a mental generalization -- it is not clear why what this labour is supposed to produce is something real -- value ; but also in the fact that this opens the door to the transformation of value itself into an abstract generality or idea as well. For, in the sense that here only useful and concrete kinds of labour are regarded as real, whereas 'abstract' labour is seen as a merely mental fact, so too only the products of useful kinds of labour or use-values are real, whereas value, the merely general element common to them, is abstract.

    The interpretation that Bernstein adopted was precisely this one. 'Value' is ein Gedankenbild, a mere thought-construct: it is in Marx's work a formal principle which serves to bring system and order to the complexity of the analysis, but itself has no real existence. 'Insofar as we take into consideration the individual commodity', Bernstein comments, 'value loses any concrete content and becomes a mere mental construction'. Hence it is clear that 'the moment that labour-value is only valid as a mental formula (gedankliche Formel ) or scientific hypothesis, surplus value also becomes a pure formula, a formula based on a hypothesis'.[82]

    This interpretation had, of course, already been advanced before Bernstein by Werner Sombart and Conrad Schmidt, in time for Engels to confront it in his Supplement to Volume III of Capital.[83] Value, according to Sombart, is 'not an empirical, but a mental, a logical fact' while for Schmidt the law of value within the capitalist mode of production is a 'pure, although theoretically necessary fiction'.

    It is striking that even at this point, decisive for the genesis of 'revisionism', Engels's response is both uncertain and substantially erroneous. Even if he makes some reservations towards Sombart and Schmidt, he ends up by accepting their essential thesis (that is, the unreal nature of the law of value when commodities are produced under capitalist conditions ), and hence falls back to the position of Smith (already criticized in its time by Marx)[84] which had relegated the action of the law of value to precapitalist historical conditions.

    In other words, 'abstract labour' and 'value' -- the point on which everything hangs -- are understood simply as mental generalizations introduced by the scientist, in this case by Marx; ignoring the fact that, if this were effectively so, in introducing these generalizations Marx would have been committing a 'clumsy error' and the whole of Böhm-Bawerk's critique would indeed be correct. The central argument of Böhm-Bawerk's critique -- already present in Geschichte und Kritik der Kapitalzinstheorien (pp. 435ff.) and restated in 1896 in Zum Abschluss des Marxchen Systems (a text which may have influenced Bernstein) -- was that if 'value' is the generalization of 'use-values', it is then use-value 'in general' and not, as Marx had argued, a qualitatively distinct entity. Marx's error, according to Böhm-Bawerk, was the error of those who 'confuse abstraction from the circumstance in general (von einem Umstande überhaupt ), and abstraction from the specific forms in which this circumstance manifests itself';[85] the error of those who believe that to abstract from the differences between one use-value and another is to abstract from use-values in general ; for the real value is use-value, the true theory of value a theory of value-utility. According to Böhm-Bawerk, this 'wrong idea' he attributes to Marx means that instead of seeing in 'exchange value' a relation or a mere quantitative proportion between use-values, and hence, like any   relation, an unreal value outside the entities related together, Marx invoked the existence behind exchange-value of an objective being 'value', without seeing that this 'entity' was only a 'scholastic-theological' product, a hypostasis arising from his defective logic.[86]

    The response that has traditionally been given to these objections by Marxists is well known. It consists, at most, in an appeal to the original conception of Ricardo who had, as can be seen from his last incomplete memoir, already before Marx distinguished between Absolute Value and Exchangeable Value. However, apart from Marx's remarks on the tendency of Ricardo's analysis to dwell more on 'exchange-value' than on 'value' itself, this response is further weakened by the fact that, confronted by the non-coincidence of 'values' and 'costs of production', this interpretation has continuously been forced to fall back on to Sombart-Schmidt positions or even Bernstein positions. For once it is accepted that value is not identified with the concrete exchange-values or competitive prices at which the capitalistically produced commodities are in fact sold, this interpretation retreats to a position of attributing to 'value' the significance, essentially, of an abstraction. Dobb's case is typical After stating that 'value [is] only an abstract approximation to concrete exchange-values', that this 'has generally been held to be fatal to the theory, and was the onus of Böhm-Bawerk's criticism of Marx', he limits himself to concluding that 'all abstractions remain only approximations to reality . . . it is no criticism of a theory of value merely to say that this is so.[87]

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  84 For this critique of Smith by Marx, see Theories of Surplus Value, Part I, London, n.d., pp. 71-2.
    85 E. Böhm-Bawerk, Zum Abschluss des Marxschen Systems (in a volume of writings in honour of Karl Knies), Vienna, 1896; English translation by Paul Sweezy: Karl Marx and the Close of his System, New York, 1949, pp. 73-4. Hilferding's reply to Böhm-Bawerk, which is the best Marxist critique of the theory of marginal utility, is nonetheless deficient on this question -- cf. Hilferding, op. cit., p. 127: 'We have in fact nothing more than a disregard by Marx of the specific forms in which use-value manifests itself.'

    81 ibid., p. 31.     82 op. cit., p. 22.     83 Marx, Capital, Vol. III, pp. 871 ff.

    75 Marx, Capital, Vol. I, p. 44.
    76 ibid., p. 38.
    77 K. Kautsky, Karl Marx's ökonomische Lehren, Jena, 1887.
    78 R. Hilferding, Böhm-Bawerks Marx-Kritik (Offprint from Marx Studien, Vol. I), Vienna, 1904.
    79 Luxemburg, Einführung in die Nationalökonomie, op. cit., pp. 412-731.
    80 P. Sweezy, op. cit., p. 30.

    73 Marx, Theories of Surplus Value, Part II, London, 1969, p. 172: Ricardo 'does not even examine the form of value -- the particular form which labour assumes as the substance of value. He only examines the magnitude of value'; in consequence, 'Ricardo is rather to be reproached for very often losing sight of this "real" or "absolute value" and only retaining "relative" and "comparative value".' And in Part III (Marx-Engels, Werke, Vol. 26.3, p. 28): 'The error Ricardo makes is that he is only concerned with the magnitude of value . . .' Cf. also p. 135. Schumpeter, too (History of Economic Analysis, New York, 1954, pp. 596-7) sees this as the most important distinction between Ricardo's theory of value and Marx's theory of value.
    74 Marx, Theories of Surplus Value, Part III (op. cit., p. 127).

    70 Marx, Capital, Vol. I, p. 80.           71 ibid., p 81 and n.
    72 This identification is already present in the first pages of The Wealth of Nations, where Smith identifies the 'division of labour' with 'exchange'. For this question, see Sweezy, op. cit., pp. 73-4, and Rosa Luxemburg, Einführung in die Nationalökonomie, in Ausgewählte Reden und Schriften, Vol. I, Berlin, 1951, p. 675.

    67 I. Kant, Critique of Pure Reason, London, 1964, p. 10.
    68 Myrdal, op. cit., pp. 160-3.           69 Goldmann, op. cit.