In the eco-socialist movement there have been frequent complaints that Marx’s value theory, with its central emphasis on labour-time, is fatally flawed and irrelevant. It seems to discount the exploitation of nature in the pursuit of profit. Students of Marx have responded by tracing the close attention which Marx and Engels gave to ecological research and debate in their period. Crucially, it has been argued that it is precisely its central focus on labour productivity which enables Marx’s value theory to generate a unique and powerful account of the environmental destructiveness of capital.
Here, two writers associated with the New York journal Monthly Review have produced an outstanding body of work. John Bellamy Foster’s brilliant book, Marx’s Ecology (2000) is now an established classic, and Paul Burkett’s Marx and Nature (1999) not far behind as a standard reference. Since then, both writers have produced further influential work in eco-Marxism, most recently the jointly authored Marx and the Earth, which has just come out in paperback. What they have emphasised above all is Marx’s thesis that capitalism tends to use natural resources without concern for sustainability. He uses the term Stoffwechsel for the metabolic exchange of matter and energy between humans and nature, and notes, for example, how capitalist industrialisation,
produces conditions that provoke an irreparable rift [Riss] in the interdependent process of social metabolism, a metabolism prescribed by the natural laws of life itself. The result of this is a squandering of the vitality of the soil. (Capital Vol. 3, p.949).
Recently however, the Monthly Review account of the ecological dimension in Marx has been challenged by a new kid on the block. Jason Moore’s Capitalism and the Web of Life (2015), [Web] accuses the Monthly Review team of failing to develop a properly dialectical account of Marx’s ecology. They remain mired in Cartesian dualism. They counterpose two separate and opposed entities: Society vs. Nature. Thus their focus is too confined to a one-way account of the damage which capitalism is currently inflicting on the environment.
Moore is not denying that we may be currently heading towards environmental disaster. But he argues that the stark Monthly Review conclusion – abolition of capitalism or planetary destruction – can lead to fatalism rather than creative political responses. Moore writes that: A dual systems approach to metabolism gives us only one flavor of crisis —the apocalypse (Web p.8o). But the combination of economic and environmental crisis which we face may take many forms in the coming period, and all sorts of technological and political action will be needed in response.
Much of Moore’s book is an exploration of the historical background to the present situation. From its inception in the long 16th century, capitalism has been hit by successive waves of crisis as it came up against limits in the availability of necessary means of production such as raw materials, energy, and land. Moore traces major turning points over the past 500 years as capitalism has reacted to resource limits by expanding geographically and technically to absorb new and cheap supplies of necessary means of production and labour. What is distinctive in this approach is Moore’s enormous stress on appropriation as opposed to exploitation. In discussing the historical evolution of capitalism, he talks, for example, about islands of exploitation in oceans of appropriation.
As originators and guardians of the reigning paradigm in eco-Marxism, the Monthly Review writers have responded aggressively to Moore’s accusation that their work is not dialectical. According to Foster, for example, Jason Moore,
abandons value theory … and has joined the long line of scholars who have set out to update or deepen Marxism in various ways, but have ended up by abandoning Marxism’s revolutionary essence and adapting to capitalist ideologies’. See interview.
My own view is that, despite many criticisms which can be made of Moore’s work, he has identified some dimensions of Marx’s value theory, which have not had the attention they deserve, not just by eco-Marxists, but more generally across the spectrum of mainstream Marxist political economy. He is asking us to look again at a fundamental question: the relationship between use-value and value in the productive process – and how they intersect when labour productivity rises. His thinking, for example, has implications for current debates about trends in profitability.
What is striking in the dispute between Moore and the Monthly Review writers is that both sides start out from the same reading of Marx’s value theory. They both strongly defend its central emphasis on socially necessary labour, against the view, widely shared among radical critics, that Marxist doctrine is complicit in a devaluation of nature.
Competition forces capitalists to reduce prices by increasing labour productivity. This is achieved mainly by mechanisation and by advances in the organization of production. As Marx pointed out, an increase in productivity will generally require an input of larger quantities of means of production, such as e.g. raw materials and energy. To sustain the rate of profit these should be obtained as cheaply as possible.
From this starting point, Moore develops a less orthodox line of argument: that the advance of labour productivity can take place without a hit to profits if capital can tap into what he calls a rising “ecological surplus” of Cheap Nature – especially in the form of low cost energy, land, and raw materials. Also labour-power, kept cheap because its reproduction is not paid for by capital – but secured, for example, by enslavement or domestic labour.
But where capital appropriates means of production cheaply and without paying the full costs of their reproduction, it tends to exhaust its own social-ecological conditions. Moore thus posits a general tendency for the ecological surplus to fall, and for cheap nature to become less cheap. Hence recurrent crises as capital runs up against limits in available resources. If the ecological surplus falls – as Moore argues is happening in the current period – then inputs into production rise in price. Capital must absorb an increasing share of the costs of reproduction. As costs rise, productivity and profits are threatened with stagnation. Thus Moore traces linkages between environmental devastation and the current economic crisis.
Let’s look more closely at the theoretical underpinning of these conclusions. Central to value theory is that the pressures of competition require firms to lower prices – and the major way in which this is done is by increasing productivity. At the centre of Marx’s law of value is labour productivity.
Marx’s basic propositions about productivity are formulated as follows:
- a working day of a given length always creates the same amount of value, no matter how the productivity of labour may vary (Capital 1, p.656). If productivity rises, more commodities are produced in a given time period, but the average value of each commodity – and therefore its selling price – will fall correspondingly.
- However, as productivity rises there tends to be an increase in the rate of surplus-value. As Marx puts it,
an increase in the productivity of labour causes a fall in the value of labour-power and a consequent rise in surplus-value… the value of labour-power is determined by the value of the means of subsistence habitually required of the average worker (Capital Vol. 1, pp.655-7).
There are some complications here: Marx accepts that more value can be produced in a given time period if there is an intensification of labour (working harder) or an increase in the skill level of workers. But these qualifications can be initially set aside in order to clarify the fundamental issue. The source of surplus-value is unpaid labour-time. An increase in productivity does not increase the total value produced in a given time, but it does increase the rate of surplus-value.
But does it also increase the rate of profit? Here the key issue is that a rise in productivity, for example via mechanisation, tends to increase the amount of constant capital which capitalists need to use in order to stay competitive. A rise in the ratio of constant capital to labour will tend to reduce the rate of profit. More capital has been advanced relative to the unpaid labour which is the basis of profit.
As productivity advances there is likely to be a rise in the mass of means of production (machinery, raw materials, energy etc.) required in production. As Marx notes,
the consequence of …the application of machinery is that more raw material is worked up in the same time, and therefore a greater mass of raw material and auxiliary substances enters into the labour process… [An increase in] the mass of machinery, beasts of burden, mineral manures, drain-pipes, etc. is a condition of the increasing productivity of labour… [For example] the mass of raw material, instruments of labour, etc. that a certain quantity of spinning labour consumes productively today is many hundred times greater than at the beginning of the 18th century. (Capital Vol. 1, p.774).
A rise in the ratio of constant to variable capital threatens to lower the rate of profit. A given rate of surplus-value has then to be divided by a larger amount of capital advanced when calculating the rate of profit.
But there is a counteracting tendency. If the advance in productivity is general, then it will apply in the sector of the economy which produces means of production. The value of a given unit of constant capital will be reduced. This fall in the cost of producing the means of production required will thus limit, or even reverse, the decline in the rate of profit as more constant capital is used.
Thus Marx emphases that as labour productivity rises, this also lowers the value and therefore the price of the constant capital required for production. The result is what Marx calls a cheapening of the elements of constant capital. The value of means of production rises, as productivity advances, but at a lower rate than the mass of means of production being used.
For example, the quantity of cotton that a single European spinning operative works up in a modern factory has grown to a most colossal extent in comparison with that which a European spinner used to process with the spinning wheel. But the value of the cotton processed has not grown in the same proportion as its mass.
It is the same with machines and other fixed capital. In other words, the same development that raises the mass of constant capital in comparison with variable reduces the value of its elements, as a result of the higher productivity of labour, and hence prevents the value of the constant capital, even though this grows steadily, from growing in the same degree as its material volume, i.e. the material volume of the means of production that are set in motion by the same amount of labour-power… In certain cases, the mass of the constant capital elements may increase while their total value remains the same or even falls. (Capital Vol. 3, p.342).
Thus, in summary, as productivity rises, there is likely to be an increase in the mass of means of production in use. But the value – and thus the price – of those means of production will tend not to rise to a corresponding extent. A general rise in productivity will also reduce the cost of means of production and so slow down the fall in the rate of profit.
In clarifying this analysis, Marx introduces an important distinction: between the technical composition of capital and the organic composition of capital.
There are two ways of looking at the capital / labour ratio. As a relation between two values – constant and variable capital. Or as a ratio between a mass of physical means of production and a mass of labour-power.
The organic composition of capital is determined by the ratio of the value of the means of production, as compared with wages. I.e. the value ratio between constant capital and variable capital
The technical composition of capital refers to material use-values- here capital is divided into means of production and living labour-power. Marx writes that:
the technical composition is determined by the relation between the mass of the means of production employed on the one hand, and the mass of labour necessary for their employment on the other. (Capital Vol. 1, p.762) [i]
It is here that Moore’s account moves in a distinctive direction. Mechanisation and improved organization of production are not the only ways in which cheaper means of production may be secured. If means of production can be appropriated – at low cost, or, better still, at zero cost – then the hit to profits because of rising organic composition of capital can be reduced or nullified. This is Moore’s central argument, one which is directly founded on Marx’s value theory. By seeking geographical or technological frontiers where the four Cheaps (raw materials, food, land and labour) can be appropriated, capital can raise productivity while protecting the rate of profit. Recurrently in the history of capital, the appropriation of new forms of cheap inputs has,
allowed capital to advance labour productivity while reducing (or checking) the tendentially rising value composition of production. The technical composition of production—the mass of machinery and raw materials relative to labour-power— could rise without undermining the rate of profit. Capitalism, we have seen, is a frontier process (Web, p.107).
Cheap Nature, as an accumulation strategy, works by reducing the value composition—but increasing the technical composition—of capital as a whole; by opening new opportunities for the investment; and, in its qualitative dimension, by allowing technologies and new kinds of nature to transform extant structures of capital accumulation and world power. In all this, commodity frontiers – frontiers of appropriation – are central. (Web, p.53).
Here Moore is challenging the analysis in Burkett’s Marx and Nature. Although Burkett – like Moore – starts out from the basics of value theory, his treatment of the mass and value of constant capital employed in production remains at a rather elementary level. I can find no reference to the organic composition of capital in either of Burkett two ecological books. There are many general comments on profit as driving the system. But no discussion of the counter-tendencies which operate to limit or reverse the downward pressure on the rate of profit as productivity rises. No attention is given to the increase in the capital/labour ratio, which Marx calls the technical composition of capital.
The monopoly capitalist tradition of Monthly Review is flawed precisely in its relative lack of interest in competition and price movements, and in Marx’s account of the determinants of rates of profit. The monopoly capitalist thesis is that, because of the concentration of capital, companies are now able to evade competition by cartels, and determine prices by fiat.
There is one moment in Burkett’s Nature book where he does discuss one of the examples of appropriation which preoccupy Moore. Burkett has a section discussing ‘child rearing labour’ and the ‘natural force of household labour power’. He writes that,
The exploitable [sic] labour power associated with domestic activities is freely appropriated by capital. It is a use value, not a value.
Burkett then notes that the appropriation by capital of this use value has implications for surplus-value.
Capital’s free appropriation of the domestic enhancement of labour power increases the rate of surplus value in so far as domestic activities lower the value of labour power (by raising the productivity of wage-labour or reducing workers’ commodified causation requirements). (Marx and Nature, p.105).
So appropriation of unpaid domestic labour by capital does not increase the total value produced, but does increase the rate of surplus-value. Capital gets its labour cheaper, and retains more of the value produced.
What Moore is proposing is a generalisation of this account of domestic labour – extending it to capital’s appropriation of natural resources.
But is it right to assimilate domestic labour, as Moore does, into a wider category of work/energy? This leads him to talk, for example, about how natural resources are kept cheap because they ‘do unpaid work for capital’. However, Moore is clear that this kind of ‘work’ has nothing in common with the abstract labour which creates value. ‘Work’ here is a use-value concept – but one which follows capital in treating use-value abstractly. The objective here is to trace capital’s abstractification of nature and its consequences.
Meticulous research by Burkett and Foster has clarified the engagement of Marx and Engels with the thermodynamic and energetics debates of their period. In their Marx and the Earth book, they trace how Marx used energy concepts to think through the use-value dimension of the labour process. There is, of course, no suggestion that the creation of value and surplus-value in the labour process is in any way determined by concrete labour. But the creation of value is also a physical metabolic process which can be studied in terms of amounts and transfers of abstract energy. In words which resonate with Moore’s work/energy concept, Burkett and Foster summarise Marx’s thinking about this as follows:
In energy terms, ‘What the free worker sells is always nothing more than a specific, particular measure of force-expenditure’; but ‘labour capacity as a totality is greater than every particular expenditure’ (Grundrisse p.464). ‘In this exchange, then, the worker … sells himself as an effect’, and ‘is absorbed into the body of capital as a cause, as activity’ (Grundrisse p.674). The result is an energy subsidy for the capitalist who appropriates and sells the commodities produced during the portion of the workday over and above that required to produce the means of subsistence represented by the wage (Marx and the Earth, p.145).
There certainly are some major criticisms to be made of Moore’s work and I’ll look at these in a future post. Some valuable commentaries on Moore’s work have already been published. [ii]. Some valid objections have come from the Monthly Review camp. For example, Foster is right to say (in the Climate and Capitalism blog cited above) that Moore neglects the question of rent. There is too little in his Web book about how private property control gets established over raw material and energy sources. The theme of enclosure, so strongly emphasised in Marx’s account of primitive accumulation, is under-weight in Moore. Often industrial capitals find that the so-called Cheap inputs are not actually so cheap – after rent is extracted by the monopoly owners of oil wells and mineral resources.
The strength of Moore’s book is the way it traces, from the long 16th century onwards, how the abstract logics of labour productivity are implemented and play out concretely – as crises of resource limits are encountered and overcome by the violence of capital, science, and state power. His focus on appropriation may at time be over-pitched, but Moore consistently directs much needed attention on the necessary conditions for the operation of the law of value. How the economic and technical requirements that make possible exploitation and value creation are established and maintained.
An addendum on profit.
Marx used the term circulating capital to refer to raw material and energy inputs. Moore’s focus on these highlights the neglect of circulating capital in current Marxist debates about trends in profits. For example, profit rates are generally calculated solely on a denominator of fixed capital (machinery etc.). This fact is rarely even mentioned in current work using National Accounts data. An exception is Andrew Kliman who mentions casually in his Failure of Capitalist Production book (pp.80-82) that: ‘My rate of profit measures … exclude circulating capital … expenditures for inventories of raw materials and the like – because information on the turnover of circulating capital is not available’. One of many instances in which the easily available National Accounts data are used and their limitations ignored. Company account based data is more difficult to obtain and use, but can be a more accurate corrective to national account based data.
[i] For a lucid account of the TCC/OCC distinction, see: Ben Fine and Alfredo Saad-Filho 2010, Marx’s Capital, Ch. 8.
[ii] See, for example, an excellent critique of Moore by the radical geographer Sara Nelson, on the Antipode website February 2016. Benjamin Kunkel has produced an outstanding account of debates around the anthropocene / capitalocene concepts – and the disagreements between Moore and the Monthly Review team. See London Review of Books 2 March 2017.
4 thoughts on “Value Theory and the Schism in Eco-Marxism”
“There are some complications here: Marx accepts that more value can be produced in a given time period if there is an intensification of labour (working harder) or an increase in the skill level of workers.”
There is also the point that Marx makes against Ricardo in Chapter 14 of Theories of Surplus Value, which is that the value of output does not just consist of the new value created by labour, it consists also of the value of constant capital. If a worker processes 10 kilos of cotton, with a value of £10, in a day into yarn, and the value created by labour is equal to £10, then the value of output for the day is £20.
However, if the worker’s productivity rises by a factor of 10, the worker processes 100 kilos of cotton with a value of £100 into yarn, and their labour adds a further £10, so that the value produced in a day rises from £20 to £110. The statement is only true in relation to the new value created.
“Marx used the term circulating capital to refer to raw material and energy inputs. Moore’s focus on these highlights the neglect of circulating capital in current Marxist debates about trends in profits. For example, profit rates are generally calculated solely on a denominator of fixed capital (machinery etc.). This fact is rarely even mentioned in current work using National Accounts data.”
I have pointed to this fact many times. Marx refers to Adam Smith’s “absurd dogma” that the value of commodities and therefore of national output can be resolved purely into revenues, rather than into revenue and capital, i.e. the value of output is equal to c + v + s, whereas the national income/GDP data is only an account of revenues (wages, profits, interest and rent). Even some Marxist economists get confused, and include the value of “intermediate production”, as being the value of circulating constant capital, in the value of final output, but as marx shows in his schemas of reproduction in Capital II, and in his concluding chapters of Capital III, as well as at length in Theories of Surplus Value this intermediate production is only equal to the new value (v+s) created in Department I by labour, i.e. equal to Department I revenues. It does not include the vast and expanding value of Department I c, which never enters (in aggregate) in circulation, and never forms a revenue for anyone, it is solely an exchange of capital with capital, as the means of production are replaced “in kind” on a like for like basis.
The calculations, therefore, of a rate of profit that do not include the value of circulating constant capital, are really just calculation of the rate of surplus value. Modifying that by measuring against the fixed capital, but excluding the circulating constant is even more absurd. The full value of fixed capital (capital stock) is only relevant if you are measuring the annual rate of profit, but in that case, it is even more vital to have not just a measure of the circulating constant capital, but of its rate of turnover. Moreover, this is a measure of the annual rate of profit (for the total social capital the average annual rate of profit), as opposed to the rate of profit.profit margin, which is measured only against the circulating constant capital, plus wear and tear of fixed capital, but excluding the total value of fixed capital itself.