Karl Marx - The Poverty of Philosophy

The capacity for all products, whether natural or industrial, to contributeto mans subsistence is specifically termed use value; their capacity tobe given in exchange for one another, exchange value.... How does use valuebecome exchange value?... The genesis of the idea of (exchange) value hasnot been noted by economists with sufficient care. It is necessary, therefore,for us to dwell upon it. Since a very large number of the things I needoccur in nature only in moderate quantities, or even not at all, I am forcedto assist in the production of what I lack. And as I cannot set my handto so many things, I shall propose to other men, my collaborators in variousfunctions, to cede to me a part of their products in exchange for mine."

(Proudhon, Vol. I, Chap.II)

M. Proudhon undertakes to explain to us firstof all the double nature of value, the distinction in value, the processby which use value is transformed into exchange value. It is necessaryfor us to dwell with M. Proudhon upon this act of transubstantiation. Thefollowing is how this act is accomplished, according to our author.

A very large number of products are not to be found in nature,they are products of industry. If mans needs go beyond natures spontaneousproduction, he is forced to have recourse to industrial production. Whatis this industry in M. Proudhons view? What is its origin? A single individual,feeling the need for a very great number of things, cannot set his handto so many things. So many things to produce presuppose at once more thanone mans hand helping to produce them. Now, the moment you postulate morethan one hand helping in production, you at once presuppose a whole productionbased on the division of labour. Thus need, as M. Proudhon presupposes it,itself presupposes the whole division of labour. In presupposing the divisionof labour, you get exchange, and, consequently, exchange value. One mightas well have presupposed exchange value from the very beginning.

But M. Proudhon prefers to go the roundabout way. Let us followhim in all his detours, which always bring him back to his starting point.

In order to emerge from the condition in which everyone producesin isolation and to arrive at exchange, I turn to my collaborators invarious functions, says M. Proudhon. I, myself, then, have collaborators,all with different function. And yet, for all that, I and all the others,always according to M. Proudhons supposition, have got no farther thanthe solitary and hardly social position of the Robinsons. The collaboratorsand the various functions, the division of labour and the exchange it implies,are already at hand.

To sum up: I have certain needs which are founded on the divisionof labour and on exchange. In presupposing these needs, M. Proudhon hasthus presupposed exchange, exchange value, the very thing of which he purposesto note the genesis with more care than other economists.

M. Proudhon might just as well have inverted the order of things,without in any way affecting the accuracy of his conclusions. To explainexchange value, we must have exchange. To explain exchange, we must havethe division of labour. To explain the division of labour, we must have needswhich render necessary the division of labour. To explain these needs, wemust presuppose them, which is not to deny them contrary to the firstaxiom in M. Proudhons prologue: To presuppose God is to deny him. (Prologue,p.1)

How does M. Proudhon, who assumes the division of labour as theknown, manage to explain exchange value, which for him is always the unknown?

A man sets out to propose to other men, his collaborators invarious functions, that they establish exchange, and make a distinctionbetween ordinary value and exchange value. In accepting this proposed distinction,the collaborators have left M. Proudhon no other care than that of recordingthe fact, or marking, of noting in his treatise on political economy the genesis of the idea of value. But he has still to explain to us the genesis of this proposal, to tell us finally how this single individual,this Robinson [Crusoe], suddenly had the idea of making to his collaborators a proposal of the type known and how these collaborators accepted it withoutthe slightest protest.

M. Proudhon does not enter into these genealogical details. Hemerely places a sort of historical stamp upon the fact of exchange, bypresenting it in the form of a motion, made by a third party, that exchangebe established.

That is a sample of the historical and descriptive method ofM. Proudhon, who professes a superb disdain for the historical and descriptivemethods of the Adam Smiths and Ricardos.

Exchange has a history of its own. It has passed through differentphases. There was a time, as in the Middle Ages, when only the superfluous,the excess of production over consumption, was exchanged.

There was again a time, when not only the superfluous, but allproducts, all industrial existence, had passed into commerce, when thewhole of production depended on exchange. How are we to explain this secondphase of exchange marketable value at its second power?

M. Proudhon would have a reply ready-made: Assume that a man has proposed to other men, his collaborators in various functions, to raisemarketable value to its second power.

Finally, there came a time when everything that men had consideredas inalienable became an object of exchange, of traffic and could be alienated.This is the time when the very things which till then had been communicated,but never exchanged; given, but never sold; acquired, but never bought virtue, love, conviction, knowledge, conscience, etc. when everything,in short, passed into commerce. It is the time of general corruption, ofuniversal venality, or, to speak in terms of political economy, the timewhen everything, moral or physical, having become a marketable value, isbrought to the market to be assessed at its truest value.

How, again, can we explain this new and last phase of exchange marketable value at its third power?

M. Proudhon would have a reply ready-made: Assume that a personhas proposed to other persons, his collaborators in various functions, to make a marketable value out of virtue, love, etc., to raise exchangevalue to its third and last power.

We see that M. Proudhons historical and descriptive method" is applicable to everything, it answers everything, explains everything.If it is a question above all of explaining historically the genesis ofan economic idea, it postulates a man who proposes to other men, hiscollaborators in various functions, that they perform this act of genesisand that is the end of it.

We shall hereafter accept the genesis of exchange value as anaccomplished act; it now remains only to expound the relation between exchangevalue and use value. Let us hear what M. Proudhon has to say:

Economists have very well brought out the double character of value,but what they have not pointed out with the same precision is its contradictorynature; this is where our criticism begins....

It is a small thing to have drawn attention to this surprisingcontrast between use value and exchange value, in which economists havebeen wont to see only something very simple: we must show that this allegedsimplicity conceals a profound mystery into which it is our duty to penetrate....

In technical terms, use value and exchange value stand in inverseratio to each other."

If we have thoroughly grasped M. Proudhons thought the following are thefour points which he sets out to establish:

1. Use value and exchange value form a surprising contrast, they are inopposition to each other.

2. Use value and exchange value are in inverse ratio, in contradiction, toeach other.