Re: Question on the rate of profit

[miychi <miyachi9@xxxxxxxxxx>]

On 2002.05.08 11:28 PM, "Jurriaan Bendien" <j.bendien@xxxxxxxxxx> wrote:

> Michael,
>
> I think your line of inquiry is a good one but very difficult for me to
> answer, I cannot really answer it as put, maybe it's impossible. Perhaps
> you weren't looking for an answer, or perhaps you could get a little bit
> more specific and elaborate the thought ? The point you raise certainly
> merits further development.
>
> Jurriaan
>
>
Jurriaan

I am an orthodox Marxist, so my answer is only from citing Capial
If difficult, Please ask me Below is from Capial



The rate of surplus-value measured against the variable capital is called
rate of surplus-value. The rate of surplus-value measured against the total
capital is called rate of profit. These are two different measurements of
the same entity, and owing to the difference of the two standards of
measurement they express different proportions or relations of this entity.

The transformation of surplus-value into profit must be deduced from the
transformation of the rate of surplus-value into the rate of profit, not
vice versa. And in fact it was rate of profit which was the historical point
of departure. Surplus-value and rate of surplus-value are, relatively, the
invisible and unknown essence that wants investigating, while rate of profit
and therefore the appearance of surplus-value in the form of profit are
revealed on the surface of the phenomenon.

So far as the individual capitalist is concerned, it is evident that he is
only interested in the relation of the surplus-value, or the excess value at
which he sells his commodities, to the total capital advanced for the
production of the commodities, while the specific relationship and inner
connection of this surplus with the various components of capital fail to
interest him, and it is, moreover, rather in his interests to draw the veil
over this specific relationship and this intrinsic connection.

Although the excess value of a commodity over its cost-price is shaped in
the immediate process of production, it is realised only in the process of
circulation, and appears all the more readily to have arisen from the
process of circulation, since in reality, under competition, in the actual
market, it depends on market conditions whether or not and to what extent
this surplus is realised. There is no need to waste words at this point
about the fact that if a commodity is sold above or below its value, there
is merely another kind of division of surplus-value, and that this different
division, this changed proportion in which various persons share in the
surplus-value, does not in any way alter either the magnitude or the nature
of that surplus-value. It is not alone the metamorphoses discussed by us in
Book II that take place in the process of circulation; they fall in with
actual competition, the sale and purchase of commodities above or below
their value, so that the surplus-value realised by the individual capitalist
depends as much on the sharpness of his business wits as on the direct
exploitation of labour.

In the process of circulation the time of circulation comes to exert its
influence alongside the working-time, thereby limiting the amount of
surplus-value realisable within a given time span. Still other elements
derived from circulation intrude decisively into the actual production
process. The actual process of production and the process of circulation
intertwine and intermingle continually, and thereby invariably adulterate
their typical distinctive features. The production of surplus-value, and of
value in general, receives new definition in the process of circulation, as
previously shown. Capital passes through the circuit of its metamorphoses.
Finally, stepping beyond its inner organic life, so to say, it enters into
relations with outer life, into relations in which it is not capital and
labour which confront one another, but capital and capital in one case, and
individuals, again simply as buyers and sellers, in the other. The time of
circulation and working-time cross paths and thus both seem to determine the
surplus-value. The original form in which capital and wage-labour confront
one another is disguised through the intervention of relationships seemingly
independent of it. Surplus-value itself does not appear as the product of
the appropriation of labour-time, but as an excess of the selling price of
commodities over their cost-price, the latter thus being easily represented
as their actual value (valeur intrinsËque), while profit appears as an
excess of the selling price of commodities over their immanent value.

True, the nature of surplus-value impresses itself constantly upon the
consciousness of the capitalist during the process of production, as his
greed for the labour-time of others, etc., has revealed in our analysis of
surplus-value. But: 1) The actual process of production is only a fleeting
stage which continually merges with the process of circulation, just as the
latter merges with the former, so that in the process of production, the
more or less clearly dawning notion of the source of the gain made in it,
i.e., the inkling of the nature of surplus-value, stands at best as a factor
equally valid as the idea that the realised surplus originates in a movement
that is independent of the production process, that it arises in
circulation, and that it belongs to capital irrespective of the latter's
relation to labour. Even such modern economists as Ramsay, Malthus, Senior,
Torrens, etc., identify these phenomena of circulation directly as proofs
that capital in its bare material existence, independent of its social
relation to labour which makes capital of it, is, as it were, an independent
source of surplus-value alongside labour and independent of labour. 2) Under
the item of expenses, which embrace wages as well as the price of raw
materials, wear and tear of machinery, etc., the extortion of unpaid labour
figures only as a saving in paying for an article which is included in
expenses, only as a smaller payment for a certain quantity of labour,
similar to the saving when raw materials are bought more cheaply, or the
depreciation of machinery decreases. In this way the extortion of
surplus-labour loses its specific character. Its specific relationship to
surplus-value is obscured. This is greatly furthered and facilitated, as
shown in Book I (Abschn. VI) [English edition: Part VI, pp. 535-43. -- Ed.],
by representing the value of labour-power in the form of wages.

The relationships of capital are obscured by the fact that all parts of
capital appear equally as the source of excess value (profit).

The way in which surplus-value is transformed into the form of profit by way
of the rate of profit is, however, a further development of the inversion of
subject and object that takes place already in the process of production. In
the latter, we have seen, the subjective productive forces of labour appear
as productive forces of capital. [English edition: Vol. 1, pp. 332-33. --
Ed.] On the one hand, the value, or the past labour, which dominates living
labour, is incarnated in the capitalist. On the other hand, the labourer
appears as bare material labour-power, as a commodity. Even in the simple
relations of production this inverted relationship necessarily produces
certain correspondingly inverted conceptions, a transposed consciousness
which is further developed by the metamorphoses and modifications of the
actual circulation process.

It is altogether erroneous, as a study of the Ricardian school shows, to try
to identify the laws of the rate of profit with the laws of the rate of
surplus-value, or vice versa. The capitalist naturally does not see the
difference between them. In the formula s/C the surplus-value is measured by
the value of the total capital advanced for its production, of which a part
was totally consumed in this production and a part was merely employed in
it. In fact, the formula s/C expresses the degree of self-expansion of the
total capital advanced, or, taken in conformity with inner conceptual
connections and the nature of surplus-value, it indicates the ratio of the
amount of variation of variable capital to the magnitude of the advanced
total capital.

In itself, the magnitude of value of total capital has no inner relationship
to the magnitude of surplus-value, at least not directly. So far as its
material elements are concerned, the total capital minus the variable
capital, that is, the constant capital, consists of the material requisites
- the means of labour and materials of labour - needed to materialise
labour. It is necessary to have a certain quantity of means and materials of
labour for a specific quantity of labour to materialise in commodities and
thereby to produce value. A definite technical relation depending on the
special nature of the labour applied is established between the quantity of
labour and the quantity of means of production to which this labour is to be
applied. Hence there is also to that extent a definite relation between the
quantity of surplus-value, or surplus-labour, and the quantity of means of
production. For instance, if the labour necessary for the production of the
wage amounts to a daily six hours, the labourer must work 12 hours to do six
hours of surplus-labour, or produce a surplus-value of 100%. He uses up
twice as much of the means of production in 12 hours as he does in six. Yet
this is no reason for the surplus-value produced by him in six hours to be
directly related to the value of the means of production used up in those
six, or in 12 hours. This value is here altogether immaterial; it is only a
matter of the technically required quantity. It does not matter whether the
raw materials or means of labour are cheap or dear, as long as they have the
required use-value and are available in technically prescribed proportion to
the labour to be applied. If I know that x lbs. of cotton are consumed in an
hour of spinning and that they cost a shillings, then, of course, I also
know that 12 hours' spinning consumes 12x lbs. of cotton = 12 a shillings,
and can then calculate the proportion of the surplus-value to the value of
the 12 as well as to that of the six. But the relation of living labour to
the value of means of production obtains here only to the extent that a
shillings serve as a name for x lbs. of cotton; because a definite quantity
of cotton has a definite price, and therefore, conversely, a definite price
may also serve as an index for a definite quantity of cotton, so long as the
price of cotton does not change. If I know that the labourer must work 12
hours for me to appropriate six hours of surplus-labour, that therefore I
must have a 12-hour supply of cotton ready for use, and if I know the price
of this quantity of cotton needed for 12 hours, then I have an indirect
relation between the price of cotton (as an index of the required quantity)
and the surplus-value. But, conversely, I can never conclude the quantity of
the raw material that may be consumed in, say, one hour, and not six, of
spinning from the price of the raw material. There is, then, no necessary
inner relation between the value of the constant capital, nor, therefore,
between the value of the total capital (=c+v) and the surplus-value.

MIYACHI TATSUO
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KOMAKI CITY
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