In Part Six through the discussion of wages in their various forms Marx begins to develop the concept of the collective worker and teases out some sources of division and mystification of the class condition. He will establish what wages represent in general before dividing his analysis into capital’s different strategies: time-wages, piece-wages and accounting for the difference in wages internationally. Prices and price movements mask fundamental social relations. The development of wages and their various forms, whether they are hourly rates or piece-rates, mask the extraction of surplus value.
Chapter 19: The Transformation of the Value (and respectively the price) of Labour-Power into Wages.
In this chapter Marx dismantles the bourgeois economists’ concepts of ‘value of labour’ and ‘price of labour’. He critiques the uncritical acceptance of value and price as natural things. Marx argues that the ‘natural price’ of labour-power must be the price of the bundle of commodities that form the worker’s means of subsistence at any given time. He reaches this conclusion by tracing the classical economists’ focus on supply and demand which merely lead us to derive “accidental prices of labour”, to the cost of production which when applied to the question of labour led them into murky waters. Marx reminds us here that labour and labour-power are different things.
Labour, labour-power and commodity-form:::: “Labour is the substance, and the immanent measure of value, but it has no value itself” (677). In response to the vulgar economists Marx argues that the value of labour is an irrational expression for the value of labour-power (679). It is not the value of labour (as activity) that is paid, but labour-power: (capacity) which is then set to work for a specific quantified period of time. “If such as thing as the value of labour really existed, no capital would exist, and his (the capitalist’s) money would never be transferred into capital” (682).
Labour-power is a commodity unlike any other; it is the commodity that creates value during a particular length of time in which it is employed. Wages only represent a part of this value, the part of the value that equates with the worker’s means of subsistence. Socially necessary labour time and surplus-labour become indistinguishable through the wage-form. All labour appears as paid labour, while there is in fact paid and unpaid labour composed in every working day (680). As a general rule for wages, “the value of labour must always be less than the value produced, for the capitalist always makes labour-power work longer than is necessary for the reproduction of its own value” (679).
For quick review: What has value? What creates value? What is the value of LP? What is the value created by LP?
Chapter 20: Time-wages
This chapter identifies the ways capitalists extract surplus value through various methods related to the time for which work is conducted. Marx establishes the basic premise that wages may remain the same although the price of labour falls constantly OR that wages may rise while the price of labour falls or remains constant. This is fleshed out in two ways: 1) that the longer the working day (the more extensive it is in magnitude) the lower the relative hourly rate becomes, and 2) that if the working day becomes more intensive in its magnitude the hourly rate is unlikely to rise and may instead be accompanied by a fall (684).
The discussion looks at contractual hire or labour-power based on an hourly rate. “The capitalist can now wring from the worker a certain quantity of surplus labour without allowing him the labour-time necessary for his own subsistence” (686). Marx identifies the unit of measurement for wages as an hourly rate, although he refers to class struggle against this with the example of a 7 month-long builders strike in London against hourly rates.
Is the hourly rate part of the development of casualised labour?
Overtime generates a situation in which the normal working day is just a fraction of the actual working day. The rates of pay for normal hours as opposed to overtime act as relative forces, coercing workers to accept overtime work. The amount of unpaid labour in both normal rates and overtime rates is mystified.
Without seeking to focus on competition in this chapter, as he will return to this later, Marx mentions two preliminary bases on which competition occurs: 1) Workers compete against each other. If a worker does more than 1 persons work in a day, then the supply of labour increases. Workers come to compete with each other for work, and capitalists can push down the price of labour. The propensity of capital to seek out (and generate) workers in conditions of greatest vulnerability is illustrated in the quote from the boss from Birmingham, “a large number of those employed by the undersellers are foreigners and youths, who are obliged to accept almost any wages they can obtain” (690). 2) Capitalists compete against each other. By not transferring the surplus-value that extra labour-time creates to the price of the commodity produced, the capitalist offers cheap, competitive commodities on the market.
Marx clarifies in the following chapter that specific work whose product is immeasurable has to be paid in time-wages (693). We could discuss how immaterial labour is quantified and waged today, are there forms of labour that require either time or piece wages? To what extent is the form of wages the result of class antagonism?
Chapter 21: Piece-Wages
In this chapter Marx argues that the piece-wage is the “form of wage most appropriate to the capitalist mode of production”, although the average sum of labour-prices is the same for both time-wages and piece-wages. There are, however, some important distinctions that I will explore below. In the following chapter Marx says “only the piece-wage can be a measure of both productivity and of the intensity of labour” (701).
By definition, the piece wage appears as labour embodied in the product already produced (how much of it in how much time) and therefore depends on the producer’s capacity for work. Marx argues that they are in fact only a modified form of the time-wage. The piece-wage is the measurement of how many products can be produced in a day’s work, and thus the value of a day’s labour may be established and from this, the daily value of labour-power.
There is a qualitative aspect to this equation that determines the intensity of labour, as it acts as a control. It acts as a lever for individual earnings. On one hand, the capitalist will attempt to rip off the worker by using the argument that a piece has a fault or isn’t of the standard quality (694). On the other, the level of training and practice that a worker has may allow them to earn more by producing more in a definite period of time and also works of greater quality. Hence, workers develop the tendency to self-police and compel themselves to intensify their own work. The self-activity of the working class in the interest of capital is also aroused in the form of managerial roles, where workers sub contract other workers, coordinate together to produce the per-piece requirements of contracts. Marx argues that the wider the scope of potential earnings the greater the sense of worker’s liberty and individuality, in competition with other workers (697).
Given this, if productivity increases and more products can be produced in less time the capitalist will remind the worker that it is how much time spent that should determine the price of each commodity produced, and through their buying power and the piece-workers own competition with each other will force the price of the commodity down.
How do we see the roots of precarious work emerge in this particular wage-form?
Chapter 21: National Differences in Wages
Marx reminds us that the factors that determine the value of labour-power may vary in different political and geographical spaces, according to the factors that influence the value of LP anywhere: “the price and extent of the prime necessities of life in their natural and historical development, the cost of training the workers, the part played by the labour of women and children the productivity of labour, an its extensive and intensive magnitude” (701). He reminds us not to confuse parity in real wages with the comparative prices of labour-power (702).
A re-thinking of the chapter on money is useful in understanding this chapter (and if there is time could we do this in our discussion this week?), as really it is about relative differences in the value of money. Wages will nominally be represented by more money in places where work is more intense, and thus production is higher. “National labour which is more productive also counts as more intensive, as long as the more productive nation is not compelled by competition to lower the selling price of its commodities to the level of their value.” (702).
There are other factors that determine standards of wages nationally, it might be useful to clarify which do not relate to labour-power (beware: here I feel like I start digging a hole for myself). Do they relate at all to how the money-form has developed up until this point? Harvey notes that there is a hint in this chapter to unequal exchange, Marx goes into this later.