such a well-done video! as a math nerd, i love how involved the statistics you used were, and it make it very easy for me to follow along with hypothetical situations! I love this channel!
Excellent video let’s do a sequel where we where we show how collusion and monopolies an inevitable conclusion and how surplus value shorts the money supply leading to market bustd or artificial inflation
Thanks Bruce! That sounds like a really good topic, definitely ideal for a discussion in a future video. Are you suggesting a collaboration? If so, you should shoot an email to themarxistproject@gmail.com and we can get started on that sequel!
I actually wasnt thinking about a collaboration because you’re DOING A GREAT JOB!! Saying that I am always open to collaborating even just exchanging information - I feel I was taught Marxist critique by one of the best at my college and I have an economic solution based on the ideas you are presenting here - so I would love to open a dialogue w you and will reach out soon !!! Keep up the good work
@@BruceBanner-tn1ug hey man I know this is late but I was wondering what college you went to where you learned this? Also, I would love to hear about your solutions!
I love your channel and I've been watching your videos for a few days. Being a beginner, I'm complementing the videos with Lenin's Three Components of Marxism. It's really helping me understand things better. I also love the fact that you engage with critical opinions in the comments section. Reading the comments provide more insight into the topic. Much love and thanks from Tamil Nadu, India. ❤️
Really good work summarizing Marx -- I find it interesting how you go for the angle of the widespread inequality that this system has created over time instead of the exploitation that it is in principle. I don't think your approach is bad, hopefully some people find it inspiring, but I'm worried that it may push people to want the 1973 capitalism instead of its abolition, ya know? Really, though, great work! Looking forward to checking out your other videos
Hi Pat! Thanks for the comment. It's always good to hear that the videos are enjoyable for people to watch. As for your concern about the inequality example in the video, I completely agree and was certainly worried myself that bringing it up might suggest the possibility of returning to a rosier capitalism. Hopefully in future videos there will be a chance to address that tendency on the right and center to call for a return to a "better" capitalism! It's definitely a myth worth debunking seriously.
Old thread, but personally I think the angle of focusing on consequence is a more convincing argument for people who don't think exploitation exists under capitalism. I've had many discussions where ppl do the digital equivalent of plugging their ears when I simply explain the concept of exploitation in the Marxist sense. No value judgments, just describing the phenomenon. If they don't outright disagree that surplus value is being extracted (often phrased "the worker agreed to the terms of employment so they cannot be exploited", a misrepresentation), they usually skip to "but it's a good thing actually" or "the capitalist deserves it". These people cannot be convinced on principle, so consequence is the only alternative. Of course for some people neither would suffice, but I think there are even less ppl who would be convinced on principle but at the same time not be convinced on consequence.
Really helpful. Not easily understood economic theory / practice. Simplifying it helps so much. Some things I need to watch 2 or 3 times to get it into my thick head. Thanx for making it make sense :)
Even using the presented framework, of course the worker needs to produce more value than they are paid. The capitalist needs to pay taxes, buy raw materials, buy the means of production, pay bills for the workplace etc. On top of that there was no consideration of risk. If a business goes under, the employee can find another job, but the employer has lost their investment into the business.
A capitalist is a person who owns a store but doesnt work it so like starbucks, that person would still be considered a worker due to the labor they are putting in to keep the shop running.
@@locallegendsfishing2598 if capitalism is not voluntary, then why are people complaining on censorship of facebook and such? Can't they just go use another website?
Capitalists who knowingly outsource labour power to the most grim (and cheapest) locations, *are* evil in my book. An intact moral compass would demand less profit or another career.
Capitalists will always find a way to turn a profit, even at the expense of other people. Morals don't work with profit, therefore profit should not be that which leads society.
These thorough, yet focused, explanations of very fundamental topics are very helpful. Most explanations out there are far too meandering for laymen like me to make sense of them. I wish I could find similar content in other languages. If anyone knows of a francophone channel that similarly explores Marxist concepts, please let me know. :)
Great video! Keep up the good work! This notions are very important for anyone trying to understand capital and capitalism. Maybe explore the law of the tendency of profit to fall and how it ties to crises under capitalism, another feature of the system that is frequently sold as an anomaly.
Question - just as much for you as for any other viewers who might know - If I own a car and I sell rides, or charge money to transport stuff around, am I selling my labour? Or am I selling a commodity that I used a Means Of Production aka my car, to create? sorry if this is a stupid question. it feels like the answer would be that im selling my labour, given things like uber and lyft - owning the car doesnt mean any more freedom than being hired as a cab driver in those circumstances only less income stability. But then again, if nobody is profiting from this and the only person getting any surplus is me, wouldnt it then mean I am the owner of something that creates profit? But then, the only thing that enables my car to make me profit is me being there and driving it, thus adding value through my labour. What about other things where value is created "out of thin air" like lets say im a motivational speaker, or a psychologist or some other type of interpersonal skill that I could do on the go, but still have someone want to pay me for, am I still selling labour if it takes no means of production? Or is my knowledge/education a means of production? and if so, then isnt that a means of production that I already own? Or is my time and energy my means of production? if so then how is that different? And if knowledge/education differs from time/energy - how? If i have no energy/time then i cant access my own knowledge and such cant acess the means of production?
These are all really great questions! First and foremost, they get at the complex nature of labor and how it has evolved since Marx wrote about it. Not everything is about concrete production on the factory floor, and not every commodity is necessarily a physical object that you can hold in your hands. This, of course, makes it hard to decipher what's really going on in the enterprise/labor process. If you own a car and sell rides, then yes, you own both the means of production and the labor power in your one-person enterprise. In this case, your economic role might fit closest to an artisan. Artisan production was (obviously) quite popular in the pre-industrial modes of production. When capitalism began to develop, the artisan economy shrank considerably because it could not compete with the efficiency and scale of capitalist enterprises. That being said, you can definitely see such cases today outside of your example. An artist who maybe makes his own pottery and sells it, or woodworker who builds custom furniture. In these instances -- and in yours -- you are still selling a commodity. For the artists, it's their products. For you it is the service of transportation that you provide (and presumably a more personable experience than getting a ride from company or taking public transport). Your self-run enterprise does not fit the capitalist mode of production because one of the prerequisites is the separation of the means of production from a class of people that need to sell their labor (workers). In other words, in your operation, you own your own equipment (the car) and do not sell your labor power to another party so that it may be used to create a commodity that then belongs to them. You own the MoP, the labor power, and the final commodity -- abstract as they may be in your case. That being said, your non-capitalist enterprise still participates in a larger circulation of capital. You bought your car from a company, buy fuel from various vendors, and buy other means of production such as tools/services for maintaining your car. The question of intellectual labor is interesting. I'm going off the books here, but my guess would be that your services as a motivational speaker, psychologist, therapist, etc. can still be categorized as labor. We should remember that labor is a commodity as well, and it is perfectly common to sell your labor to willing buyers (after all, that's what every worker does when they are hired by a company). Now, you could run your own enterprise for these professions as well, which probably reflects the scenario where you offer rides to people in your own car. In the case of therapy, you may run your own practice, in which case you would hire workers with various skills to maintain and expand the scope of your service. At that point, you have become a capitalist, since you are buying labor power and using it to turn commodity X into a new commodity Y (though in that case it would be super abstract since we are talking about a social service). You have probably also purchased a building and all the tools and labor needed to maintain it, so you could say you do have means of production. I think Marx and others would probably consider intellectual services a form of skilled labor. The only difference is that if you sell your labor to a company, they get to decide what to do with the value it generates. If you are your own master, that decision is in your hands alone. You are selling your labor in both cases, but in the latter situation you have more control. TL;DR: 1. If you run your own enterprise and own your MoP, you aren't really operating within the capitalist mode of production, though your self-run business still uses the broader market to function. The moment you start buying other people's labor power and using the subsequent value that comes from it, you become a capitalist. 2. The uniqueness of labor power as a commodity is that it is the only thing that can create value "out of thin air." That's why it's so important to Marx. All labor creates value out of thin air. Sometimes with the aid of MoP, other times without. The question is mostly about who decides what happens to that value. 3. Energy and time are components of labor (if they are being used with productive intent). Education/knowledge (in some cases) determine the value of your labor, which is also a commodity. As with all commodities, producing and reproducing labor comes at some cost. This includes the daily stuff like food/shelter/clothing, but also long term costs like education. Sorry for the *really* long response. I hope this clears some things up for you! Please feel free to ask follow up questions!
I find his approach difficult to quantify. I created a better expression of the Marxist sentiment about 'exploitation' which is much more useful from an engineering point of view. (There is the owner and the employee. Ultimately, the 'Employee' makes the products, takes those products to the market, sells the same products, he made, to himself and finally he pays a fee known as Profit to some 'Owner' for a permission to own the same products he made and sold to himself. The owner gets to collect profit for doing nothing.....and many call that 'earning' instead of 'taking'. The relationship is PARASITIC in nature, not SYMBIOTIC nor COOPERATIVE. For the 'owner', the 'employee' is a cost that must be reduced or eliminated. For the 'employee', the 'owner' is an obstacle preventing access to what the 'employee' needs to survive or prosper. THERE IS NO SPACE for anything "voluntary" since those are diametrically opposite interests. All labor is done by the 'employee', the 'owner' just receives 'Profit' for doing absolutely nothing … and some call that 'earning' instead of 'taking'.. ...or "passive income", etc. Some individuals are more 'owners', others are more 'employees'. Some individuals are mostly 'owners', others are mostly 'employees'. Some individuals are just 'owners', others are just 'employees'.~ The free trade and free markets inevitably result in few 'just owners' and vast number of 'just employees'.)
In terms of exchange value, does the worker really create "surplus" value, or is it simply that some of the labor-time he puts in isn't accounted for in the wages?
"The worker produces more in value than he is given in monetary compensation." (4:19) You mean, the worker doesn't get to pocket the full $5 sale price of each t-shirt he produced. That's because the worker did not produce "$5 in value." He produced a t-shirt. There is no $5 until the t-shirt gets sold. For that to happen, someone has to go out and find a customer and make a sale. Acquiring new customers can be costly and time consuming. People don't do that for free. So each shirt's final $5 sale price has to cover both the making of the shirt and the selling of it. And that money gets divvied up between the worker and whoever acquires the customer.
Ahahah those who go out to make a sale are called sellers and are also workers. Imagine thinking you could disprove the most influential scholar ever with a stupid comment on UA-cam 😂😂😂 Cope harder.
I think there's one point that needs further elaboration. Some people (including some self-described Marxists) tend to say that all the surplus value belongs to the workers who created it on the assembly line. But in reality, our society, and the manufacturing cycle, are very complex, and the "surplus" has to be shared with all the workers, not just production workers, but also transportation workers, sales workers, advertising workers, bank workers etc... And of course, lets not forget the parasites who expropriate - the manufacturing capitalists, the bankers, the landlords etc... In summary, in our current capitalist system, the surplus is a social product that is expropriated by the capitalists, but the surplus should be used to benefit the whole of society - free education, free medication, free housing, free public transportation etc...
very well done, this is a very goood intro, good graph, and data to study this concept. If people can add CC in this video (or the entire series), this will be revolutionary for all people arround the world to learn nore about marxism. Cheerzz from Indonesia.
These video are incredibly helpful and act as a great study aid for anyone starting out in their Marxist studies, as well as refreshing as I am doing. I enjoyed this video in particular for the simplistic explanation using an easy to understand commodity but also connecting it with the actual realities of capitalism and showing that inequality is symptomatic of capitalism - as you said, it IS the system. This helps to understand class consciousness too, given that we should expect the bourgeoisie to act in accordance with its interests as a class and for the political parties to represent those interests through the "liberal democracies" or "constitutional monarchies" which serve this mode of production. This helps us to get down to the science of the issues and shows why Marxism is necessary to defeat the social ills which are seen as moral issues by those who are trapped in idealistic ways of thinking. You see so many liberal bourgeois commentators talking about "making capitalism work for everyone" (I intended a joke of a seminar run by a popular economist called "Transforming Capitalism" and, as you can imagine, the answers to their questions are already there, in that scary ideological framework known as "Marxism"!), yet we know that the integral nature of the system has not changed and cannot change. One of the most difficult aspects of Marxism IMO is political economy which forms such a crucial part of the science, and part of this is the density of Capital - even though its thoroughness is part of its brilliance - and so being able to understand these concepts in relation to our current historical stage within capitalism is highly necessary IMO and you manage to pull that off very well in this video. Kudos comrade!
With thd chart from 1973 onward, in 1971 nixon removed the gold standard, and further enforced statae capitalism which devalued the currency only the state was legally allowed to produce. So, while wages did stagnate, wages also lost value over time as well.
The thing you neglect to mention is that it's a two way street. The business owner wants to pay the workers as little as possible but the workers want to be paid as much as possible. This sets wages at equilibrium.
Thanks for your comment! How and where do you see workers being able to affect their wages? If you are referring to strikes and collective action, then yes, workers are able to have some influence on what they are paid. But this overlooks the main thesis of surplus value/labor, which is that a capitalist *always* pays his or her workers less than the value of their labor. Not because of some evilness or greed, but because not doing so would mean breaking even, i.e. not making a profit. The constant tug-of-war between the business owner and the workers will always stay within the parameters of profitability, aka. the generation of surplus value, aka. the use of some portion of unpaid labor in the production process.
@@themarxistproject I was specifically referring to the hiring process when wages are first negotiated. Perhaps people at the bottom like janitors, cashiers, cooks at fast food restaurants, and other low occupations wouldn't be paid a lot but other occupations, particularly those in the medical field, tend to pay very well. And what of all of the other costs of running a business such as utilities?
Sure, wages can be negotiated, but only on grounds established by the business owner. Yes, there are certainly gradients in wages, especially from field to field. That, however, does not affect the presence of unpaid labor in the process of accumulating capital. Even high-wage sectors like IT and medicine still pay their workers less than the value of their labor. The non-labor costs of running a business are constant. Not because their prices are fixed, but because the business owner cannot generate new value from them. Their value in the production process remains the same. Their function is to facilitate the part of the production process that does create new value: labor. As such, a business owner cannot get utilities or the means of production to produce a value above the value he acquired them at. This is why Marx treated those costs as part of constant capital, and labor as variable capital. Say I was a business owner who wanted to sell cars for a profit. I've bought the facility, the tools, and the raw materials needed to actually make the cars. The sum cost of all those things is $100,000. I have yet to buy labor to make anything meaningful out of the things I have invested in. As it stands now, without the addition of labor into the equation, the value of everything I have acquired is basically the same (prices may have fluctuated based on changes in the market, but I am unlikely to find a way to sell off my assets with any profit margin). In order to make something of my investments thus far, I'm going to have to buy labor so that it may bring all the pieces together and impart into the final commodity value that did not exist before work was put in. If I pay my workers a wage equal to the value they've given me in the working day/month/year, I am once again breaking even (or in the worst case, losing money). My only option is to compensate the workers below the true value of their labor. I may very well still pay them a "desirable" salary, but it would still have to be below the value they've produced for me. I hope this cleared some things up. You're probably better off tackling Marx's Capital (Vol 1) for a deeper exposition of how this works. Alternatively, I would suggest "Wage-Labor and Capital" or "Value, Price, and Profit," if you want shorter works.
Hello, Can you do a comparative video on Subjective Theory of Value (STV) And Labor Theory of Value (LTV). I think this is crucial. Because many consider value to a subjective affair or of Demand & Supply. For example a religious person may consider "Holy Water" to of immense value. But for a non religious person it's just water. And In some places certain items have more value due to scarcity, this is especially true of antiques. Even a copper coin of 2000 yrs old have more "Value" . So What makes LTV ? I can see the power of LTV in Social Analysis. But other than that does it have any use ?.
I think the difference here is between price (how much a capitalist can sell a commodity for, which can be manipulated by advertising) and use value. Some things will only be used in a certain context, such as a sewing machine only being useful to a person or firm that sews but having no use value, and thus no exchange value, to a person or firm that doesn't. Thus, the Holy Water would have a use value to certain religious community but not to others or non religious populations. However, the commodity is that object that is produced by human labor for the purpose of exchange, so if Holy Water is being produced, and it has a use value, but doesn't get sold, it is not subject to the commodity form. Hope that helps, sorry no one was able to respond before now :)
You can look at it from consumer prespective as well. There is always surplus that is extracted from consumers....Which often cant run itself in long run. Because you got people who will turn old, people who will earn low wages, people who lost their job to automation, people with no healthcare, etc.
I find his approach difficult to quantify. I created an expression of the Marxist sentiment about exploitation in a much more useful way from an engineering point of view. (There is the owner and the employee. Ultimately, the 'Employee' makes the products, takes those products to the market, sells the same products, he made, to himself and finally he pays a fee known as Profit to some 'Owner' for a permission to own the same products he made and sold to himself. The owner gets to collect profit for doing nothing.....and many call that 'earning' instead of 'taking'. The relationship is PARASITIC in nature, not SYMBIOTIC nor COOPERATIVE. For the 'owner', the 'employee' is a cost that must be reduced or eliminated. For the 'employee', the 'owner' is an obstacle preventing access to what the 'employee' needs to survive or prosper. THERE IS NO SPACE for anything "voluntary" since those are diametrically opposite interests. All labor is done by the 'employee', the 'owner' just receives 'Profit' for doing absolutely nothing … and some call that 'earning' instead of 'taking'.. ...or "passive income", etc. Some individuals are more 'owners', others are more 'employees'. Some individuals are mostly 'owners', others are mostly 'employees'. Some individuals are just 'owners', others are just 'employees'.~ The free trade and free markets inevitably result in few 'just owners' and vast number of 'just employees'.)
@Nick White That labour, often intellectual labour, is done mostly by other workers, including ones long dead. For the immediate living labour, it is surveying, researching, creating models, visiting plants, doing engineering, communicating with lawyers, contractors, writing reports, etc etc. Now the owner may be one of those doing this also, or he may even do more than any other in those tasks, but in principle he doesn't need to in order to be the owner and make a profit. That is why there are owners who don't do anything, some who do a little, and some who do a lot. But the worker in principle would not be the owner and still do what he is doing, he doesn't have the flexibility, he can't outsource it all.
Productive and unproductive labour are worthy related concepts looking into for anyone unfamiliar. Some workers are definitely more of an expense than adding surplus value
How would you confront an argument that states that the difference between the growth rate of wages and productivity can be attributed to technological advancement as opposed to greater intensities of work?
Good visualization of Marx's labour theory of value! We are a small team in Hong Kong and have also tried to explain these Marxism concepts in the form of short animations. Our latest video has English subtitles, and we're looking for constructive comments as well!
can you recommend us a book about primitive accumulation and how wealth and power concentrated in the hands of few so they can use that accumulated wealth as a capital to exploit again and again ?
You argue that everybody would value the commodity as the original seller does? That everybody values everything equally? That value is objective? Upon what grounds?
I think the misunderstanding here is more semantic than anything. In Marxist theory, the value of a commodity is not quantifiable, per se. It's a pretty abstract concept. I would suggest you read more on that (Capital Vol 1 has a lot on this matter). Alternatively, check out the videos on the commodity and commodity fetishism on this channel! Marxists acknowledge a difference in "use-value" between the buyer and seller. Marx actually talks about this, noting that for the capitalist selling the commodity it's use-value is just a means to realize profit. For the buyer of course, the use-value is whatever the commodity's function is designed to be. Exchange value is based on the quantity of labor put in to the production process. Labor is the only thing that unifies commodities, it's the common denominator. Again, see the other videos for more on this. Exchange value is *not* price. Orice fluctuates around the value of the commodity. This is why some pencils might cost more than others. Commodities are obviously subjected to market fluctuations, changes in supply and demand. The difference in intrinsic value, however, is observable in, say, the difference between the average price of a car and the average cost of a pencil. Supply and demand alone cannot explain why cars on aversge cost more than pencils. When supply and demand are in equilibrium, a car is still going to cost more than a pencil. The reason for this? It takes more labor on average to produce a car than it does a pencil.
@@themarxistproject supply and demand depends on the maximum people are willing to buy x the maximum people are willing to sell. buyers will pay more for cars because they are more useful than pencils, and sellers won't take less because it wouldn't be profitable. labour value does not explain why a league football player earns more than a miner. it takes way more labour to swing axes for hours in a hot mine than it does to kick a ball to the other side of the camp. why the player earns more? because many people can an would swing an axe a few dollars/hour, but only a handfull can play like Messi and most football teams would pay millions to have someone who can.
Cars may on average be more useful than pencils (though that depends on the situation), but you could say that staple food items are even more useful than cars or pencils, and yet they are (mostly) cheaper than cars. Again, at equilibrium, the *average* price of a car will always be greater than the average price of a tomato, and that disparity is best understood as a difference in labor input. The question of the football player is an interesting point. Much like art, we sometimes observe a massive gap between the labor input and the final going price of the commodity. However, those instances are statistical outliers and do not fit well into a discussion of averages. Picasso's paintings may sell for millions, but millions of average commission pieces or works of art sell for a very careful measured amount of labor put in to them. As someone who has done freelance graphic design, I can tell you that for the vast majority of creators, the amount you can charge for your work depends heavily on your labor (both in terms of training and average input). As I believe I mentioned earlier, Marx acknowledged that price is subject to supply and demand. Value in Marxism is kind of a confusing concept because it's fairly abstract and isn't necessarily metrically quantifiable. That being said, value's role is in explaining an underlying similarity between all commodities as products of labor, whose price on the market reflects a socially necessary labor time associated with their production.
Yes, but when the cost of inputs (example: labor) decrease, supply increases, and when income decreases (example: wages), demand decreases. The net effect is a decrease in the equilibrium price. Simpler: yes businesses wish to lower costs of inputs and maximize prices, but they must also maximize quantity (total revenue = price * quantity); if demand is elastic at the current price, then total revenue will increase when the price is lowered, so there would be a downward pressure on prices. Similarly, if each business decreases wages, people would buy less, and the aforementioned effect would occur. Overall, the current wages given prices, or the wages given “abstract,” “unquantifiable,” “labor value,” doesn’t seem to matter as much. You also don’t seem to mention quantity very much. Pre-midterm ECON 101 stuff.
If the worker who makes t-shirts, stopped working after 4 hours (earning 20$), the output of t-shirts would decrease from 8 to 4, and if we use the same rigid mathematics as in this video, the price of each t-shirt would consequently rise up to 10$ due to a lower supply of t-shirts. Which means, for the capitalist, that sales revenue would still be 40$; and for the worker, that he must purchase more expensive t-shirts for the same salary as before. In other words, his standard of living has decreased. If we on the other hand increase the workers' salary from 20$ to 40$ at 8 working hours, the price of t-shirts will be raised accordingly to 10$ due to customers increased purchasing power, and there will be no increase in the standard of living. Except, in this scenario, there is no means to maintain capital, and as machines wear out, one will not be able to maintain output. Thus, in the long run, the standard of living will decrease. The third option (to comment on your last point), would be to increase the worker's productivity-through capital investment-from 8 t-shirts to, let's say 16, and if wages stays the same, 20$, each t-shirt would now go for 2.5$. Which means that the standard of living has increased. The point here, disregard of how statistics can be used for anything, is to ask who consume all that increase in productivity if not the workers. Increased output is what increase real wages, i.e., we get more stuff for the same amount of money. That's why we today have PCs, phones, freezers, stoves, cars and many other products as opposed to before when these products were reserved for the rich. Which brings us to the gap between rich and poor. The gap might be big in terms of assets and capital. However, these assets are locked into production which employs us and produces all the goods and services that we enjoy. Which again mean that, in terms of living standard, the gap between rich and poor is smaller. I.e., both rich and poor enjoy these same products, PCs, phones, etc. (Bear in mind that economics is not this rigid and straightforwardly as I have not accounted for economies of scale, and how every marginal unit added to output affect prices and the maximization of profit).
I don’t know how surplus value would work as there is no definitive price to labour? the value of labor is subjective. There is no set objective "amount that they produce." A worker in a mine is not solely responsible for production. He isn't financing the operation. He didn't bring the equipment. He didn't transport it. He didn't refine it or market it. several people went into producing x thing. please explain.
Wouldn't a capitalist argue that the inherent value of a t-shirt is 40 (20 materials + 20 labor), but due to the law of supply & demand they are able to apply a considerable profit margin on top of that, by selling it e.g. for 100? The question would follow of course why the worker wouldn't deserve a cut from those profits, but the point I'm trying to make is that the t-shirt still costs 40, it's not like a value of 100 is produced directly. Though I don't know if that makes a difference at the end.
Wages are generally considered an expense. Profits are revenue minus expenses. Workers don't get a cut of the profits, they get a cut from the revenue. The profits generally are either reinvested or go to the owners or shareholders. A worker can also be a shareholder, thus could get a cut from the profits.
هل من وسيلة ربما رقمية بتقنية البلوك تشين كالعملات الرقمية مثلا لكي توضع كمقياس لقيمة عمل الأفراد كوحدة واضحة كالمتر والغرام والفولت تقيس القيمة بدقة أو بتقريب أو بمؤشر وتوضع في رصيد أممي متفق عليه عوضا عن الأوراق المالية فتجربة ورقة 100 دولار باتت واضحة في فضحها لوهم قيمة الورقة المالية التي ضحكوأ علينا بها وهي لاشيء الكل قدم خدمات وسلع من عمل بها وعادت لصاحبها
Hey, great video! I have a couple of questions: Would a completely automated factory not produce any profit then? Is it possible to divorce the labor theory of value from relative prices and just use it as an explanation of the source of profits, capitalist exploitation, and capitalist contradiction?
Yes, according to Marxist theory, full automation would not be able to create any new value. You could maybe secure profits by maintaining the price above the value of the commodity....but that's probably not sustainable in the long run. I suppose so, though I can't think of any instance where that's been done. The LTV is definitely more of a theoretical tool than a practical one. And after all, it is the labor theory of *value*, not price. So I'm inclined to say yes, you can probably separate the two.
Isn't price the reflection of value of commodity? And in turn, the value of commodity is the abstract labor manifested in it? How can we divorce the both?
It's relative to the demand of the commodity in the market. As long as commodities are being rendered to the consumers and there are people willing to pay for that stuff (Like food lol) then a fully automated means of production can still produce "valuable" commodity.
@@themarxistproject Many products nowadays are created mainly through automation, precisely because it is more profitable than physical labour. The truth is that the more labour something requires, the less profitable it becomes, since you have to pay the worker more. By marx logic, we would still have shoe shiners, and light holders instead of lampposts and those people would make just as much as a car factory worker.
i completely disagree with the ideas of this video, as i have put in a few reply sections, but this was a great video anyways, thank you for the explanation
Hi Davi! Thanks for your comments! It's always good to have disagreement without incessant name-calling, which is sadly the way ideological clashes tend to go. Your responses are very much appreciated.
Hey.. thanks for the video. It's really good. Can you do one video about the critics of LTV and its responses? I'm really looking forward to one such video. Keep up the good work!
The thing missing in this is risk. Wages function almost like a futures contract between workers and the capitalist. Say a worker got the full value of their productive capacities and the capitalist is not making profit. What happens when sales drop for some reason? If the end product sells for less or is sold less, then that would mean the labor is now worth less. So the worker would be compensated less but would have still invested the same amount of hours. This is a risk that the employee takes on under this arrangement. So an employee that doesn't want to risk a 40/hr week investment and still not be able to pay the bills, may make a contract with the capitalist to get an agreed upon and consistent wage to mitigate any risk. Now the capitalist takes on all the risk because if sales decline for any reason, they still have to pay that agreed upon wage and eat the losses. But along with that risk, they get the opportunity to gain profits if sales ever go up. So when you factor in risk, you can see that the surplus value is really just an insurance policy that the worker pays for a guaranteed sell price of their labor in the future.
No, if sales decline, capitalists start to fire workers, decrease wages and increase working hours, and the only thing workers can do about this is quit on their own.
This is a great summary, but I just can’t agree with the theory. For one the model ignores the initial cost of capital, it just assumes capital exists. I also feel like there should be a distinction between surplus value the capitalist can take as income and the sv used for expansion. I also think it’s simplistic to say that LP is the only thing that adds value to a commodity when there are multiple necessary components
Thanks for your comment. To respond to some of these points: 1) Ignoring initial costs is fairly common practice in most economic theories. Working with net products / value-added terms allows the model to focus on what is actually being produced. This is not really unique to Marx. 2) There is a distinction between the uses of surplus value as income for capitalists and surplus value as a means of expanding capital. Marx elaborates on this quite substantially in his discussion of simple and expanded reproduction (there is a video on the channel that covers precisely this issue). 3) There are other inputs in Marx's model, apart from labor, which impart value into the commodity. Value is added to the commodity from capital as well. All capital inputs (raw materials and machines), however, are considered as "dead labor", meaning they originate from earlier production processes, and hence from past labor (regressed through enough steps backward in the value chain). The point is more that only labor can create *new* value. Labor is the primo genitor of all value that is produced in economies. Still, some portion of a commodity's price reflects the value added by non-labor inputs. Marx always recognized this.
Main weakness is the claim that labor is the sole source of value. If a machine costs $X and produces Q output and a new machine costs $X and produces 2Q output, wouldn't the new machine be twice as productive? Here we assume the worker does the same amount of work, but technology changes.
The example you just provided doesn’t disprove the value creating property of labor lol. Machines are mechanical substitutes for producing and applying labor, except a capitalist doesn’t have to continue to pay wages for the machines labor, except for maintenance. No commodity could exist without labor, and is more essential than anything else
I regret to say that the piece is not “The Dance of the Knights.” It does resemble that, however, it is not that. I’ve dived into the comments with the hope that I’d find out the name. Will write when/if I’d found it.
This is one of the fairer videos I've encountered on Marx, yet I still find an issue with the implication that the capitalist always profits from the labor of a worker. That's obviously their goal but it's one that isn't always realized: the capitalist invests with hope, not a guarantee, of a return of investment. The capitalist gambles on the worker. Not every t-shirt produced is a t-shirt sold. In many cases, a worker's output is variable and difficult to predict yet they get paid an agreeable sum, and sometimes while the business is bleeding money left and right. I also find that no matter how distasteful we find a capitalist's profit incentive, it's difficult to come up with a system that ensures that workers are paid more. I've even seen multiple cases where people working in voluntary co-ops attest that they are typically earning less than they otherwise would. That seems to harshly contradict the idea that capitalist business models are underpaying their workers. They might enjoy the working conditions of the co-op more but it doesn't seem the case to me that alternative business models sharing the means of production will actually translate to pay raises for those who share in the MoP.
Yeah I was thinking the same here. Also is there no such thing as a fair profit? I can understand the gross exploitation of workers in less developed worlds, but if a capitalist takes the risk to invest in the cotton and the machines of production and then pays their workers a fair/predictable wage is surplus value not at least somewhat justified for that risk/paycheck promise? Where is the issue here, am I missing it?
@@skepticalwendigo3702 Firstly, I believe workers should be paid/subsidized/educated more fairly-which there is a lot of latitude in “fairness” (by who’s standards.. Unions? Corporations? Governments?) My point is that there are _many_ people who don’t want to face the dynamic conditions of the market everyday and so rather than make their way into that world of greater contingency they choose instead to stay beneath the shelter of an employer, who absorbs many risks of shocks and seasonal slowness etc. Yes the market is race to the bottom in many ways which has been terrible for workers, great for big pig capital owners-but I think taking risk is something noble if done right. In fact even the Bible in the _Parable of the Talents_ (25:14-30) says that we should not bury our money in the ground, but put it to work in the world: _”from those who do nothing, even what little they have will be taken away.”_ Almost anyone can get a loan if they have a good idea and business plan, but few have such confidence in their plans to risk the gamble, for those that do and succeed I think they deserve some amount of surplus for that legwork/sweat.. but does that mean total compensation should be 150x their base worker-hell no, that’s an illness.
@@nightoftheworld you make it seem like as if everyone has a fair shot at making it if they just contributed to the gamble. Because in gambling I think you’d know that in casinos they aren’t really well known for being fair or truthful.
@@skepticalwendigo3702 don’t be silly-it’s all risky, the fairness is in the freedom to fail in pursuit, the unfairness is in how much privilege one has assisting/informing their decision making here-but too much equality is also bad. There are many problems, some now glaring like feminine liberation/BLM/tax havens-but I think the ultimate oppression is you stomping on any sparks of ambition here, deterring people from even trying to become involved by suggesting essentially that average people have no real shot in this world, that it is casino odds in here. No way-much more flexibility and opportunity than that, especially with one sharpened idea, it’s more open than you hyperbolize. I think there is an aspect of falling in love with blaming everything but oneself that is the leading cynical position today. Like Zizek says, the Marxist dream of decaffeinated capitalism, of a revolutionary subject coming along to free us from our chains is *dead* which means _wake up and fall in._ The capitalist appropriation of the ‘68 emancipatory project by ex-hippies like Jobs/Gates is exemplary. Humanity has been trying to see itself more fully in the mirror of history, but it always involves contradiction, it needs our help to become more fully and ethically responsible, and that means working through the shit, even if it’s impossible.
The problem with this is: The worker is not producing the value by themselves. The worker is also leveraging the resources of the company they work for. Eg: The physical assets of the company, the relationships it's built up, it's reputation, it's design, it's customer base, etc.
"no capital to reinvest and expand/compete" - this is another point to be presented, but the basic idea is under socialism workers decide how the company is run. So the democratic manager, executive or the leader of the business will have to convince workers to basically donate money towards the business to fund the expansion, innovation, research or whatever. In other word, worker democratically willing to lower their wages to reinvest into the business. The workers will be compensated for their investment if the consumers values the business product more and is willing to pay higher due to better functionality due to innovation, higher demand through expansion or whatever. In short, the investment of the workers pay off if it increase the values of the product they are producing. Higher values means higher wages. Ultimately, the "capital to reinvest and expand/compete" will comes from the investment of the workers of the company.
How does Marx acknowledge demand for the commodity? Labor may be what adds value to a commodity in production, but how do we determine the worth of that value?
I like how capitalism has pulled more people out of poverty and has consistently caused the societies its been implemented in to flourish but people still find obscure ways to find flaws.
"Pulled more people out of poverty" haha, caloric intake was on average, higher in the Soviet Union than the US. "Obscure ways to find flaws" only obscure cause you cant look at the glaring problems right in front of you
Thanks makes that dense texts alot more understandable especially the extended formula helps alot
Ah I need a break from the hellsite reddit is this is perfect
Reddit is bot dialog. Their bots can nudge any dialog in favor of against any paid agenda
such a well-done video! as a math nerd, i love how involved the statistics you used were, and it make it very easy for me to follow along with hypothetical situations! I love this channel!
Excellent video let’s do a sequel where we where we show how collusion and monopolies an inevitable conclusion and how surplus value shorts the money supply leading to market bustd or artificial inflation
Subbed
Thanks Bruce! That sounds like a really good topic, definitely ideal for a discussion in a future video. Are you suggesting a collaboration? If so, you should shoot an email to themarxistproject@gmail.com and we can get started on that sequel!
I actually wasnt thinking about a collaboration because you’re DOING A GREAT JOB!! Saying that I am always open to collaborating even just exchanging information - I feel I was taught Marxist critique by one of the best at my college and I have an economic solution based on the ideas you are presenting here - so I would love to open a dialogue w you and will reach out soon !!! Keep up the good work
@@BruceBanner-tn1ug hey man I know this is late but I was wondering what college you went to where you learned this? Also, I would love to hear about your solutions!
I love your channel and I've been watching your videos for a few days. Being a beginner, I'm complementing the videos with Lenin's Three Components of Marxism. It's really helping me understand things better. I also love the fact that you engage with critical opinions in the comments section. Reading the comments provide more insight into the topic. Much love and thanks from Tamil Nadu, India. ❤️
So glad to be a useful resource :) Keep reading, comrade!
Really good work summarizing Marx -- I find it interesting how you go for the angle of the widespread inequality that this system has created over time instead of the exploitation that it is in principle. I don't think your approach is bad, hopefully some people find it inspiring, but I'm worried that it may push people to want the 1973 capitalism instead of its abolition, ya know?
Really, though, great work! Looking forward to checking out your other videos
Hi Pat! Thanks for the comment. It's always good to hear that the videos are enjoyable for people to watch.
As for your concern about the inequality example in the video, I completely agree and was certainly worried myself that bringing it up might suggest the possibility of returning to a rosier capitalism. Hopefully in future videos there will be a chance to address that tendency on the right and center to call for a return to a "better" capitalism! It's definitely a myth worth debunking seriously.
Old thread, but personally I think the angle of focusing on consequence is a more convincing argument for people who don't think exploitation exists under capitalism.
I've had many discussions where ppl do the digital equivalent of plugging their ears when I simply explain the concept of exploitation in the Marxist sense. No value judgments, just describing the phenomenon. If they don't outright disagree that surplus value is being extracted (often phrased "the worker agreed to the terms of employment so they cannot be exploited", a misrepresentation), they usually skip to "but it's a good thing actually" or "the capitalist deserves it".
These people cannot be convinced on principle, so consequence is the only alternative. Of course for some people neither would suffice, but I think there are even less ppl who would be convinced on principle but at the same time not be convinced on consequence.
typical commie. the only interest he has in an argument is its usefulness as commie propaganda. he has no regard for the truthfulness or lack thereof.
It's not a bug, it's THE feature.
Really helpful. Not easily understood economic theory / practice. Simplifying it helps so much. Some things I need to watch 2 or 3 times to get it into my thick head. Thanx for making it make sense :)
The World Needs more of guys like You
Consistency is the secret for your success
God Bless
Even using the presented framework, of course the worker needs to produce more value than they are paid.
The capitalist needs to pay taxes, buy raw materials, buy the means of production, pay bills for the workplace etc.
On top of that there was no consideration of risk. If a business goes under, the employee can find another job, but the employer has lost their investment into the business.
A capitalist is a person who owns a store but doesnt work it so like starbucks, that person would still be considered a worker due to the labor they are putting in to keep the shop running.
Could you do a video on the “capitalism is voluntary” argument?
Absolutely, that sounds like a great video topic!
It is on the to-do list, but the video production process is super tedious and time consuming. It should be one of the next few videos to be released!
@@themarxistproject lol I’d love to hear your mental gymnastics for that one
@@locallegendsfishing2598 cope
@@locallegendsfishing2598 if capitalism is not voluntary, then why are people complaining on censorship of facebook and such? Can't they just go use another website?
Watching this at 3AM in dark background hurts my eye but gotta learn theory
probably the best explanation of theory of surplus value ... simplistic, diagrammatic and with a meaningful plot ...
Capitalists who knowingly outsource labour power to the most grim (and cheapest) locations, *are* evil in my book. An intact moral compass would demand less profit or another career.
Capitalists will always find a way to turn a profit, even at the expense of other people. Morals don't work with profit, therefore profit should not be that which leads society.
nah, that's just the Cantillon effect in play
That's why tariffs and subsidies are good.
Thanks so much. I'm behind on my reading but I need to be able to discuss in class so this was practically perfect.
These thorough, yet focused, explanations of very fundamental topics are very helpful. Most explanations out there are far too meandering for laymen like me to make sense of them.
I wish I could find similar content in other languages. If anyone knows of a francophone channel that similarly explores Marxist concepts, please let me know. :)
Is there a difference between surplus value and profit. If so, what is it? How would you go about explaining it?
Great video! Keep up the good work! This notions are very important for anyone trying to understand capital and capitalism. Maybe explore the law of the tendency of profit to fall and how it ties to crises under capitalism, another feature of the system that is frequently sold as an anomaly.
A video on the tendency of the rate of profit to fall is a great idea!
Question - just as much for you as for any other viewers who might know - If I own a car and I sell rides, or charge money to transport stuff around, am I selling my labour? Or am I selling a commodity that I used a Means Of Production aka my car, to create?
sorry if this is a stupid question. it feels like the answer would be that im selling my labour, given things like uber and lyft - owning the car doesnt mean any more freedom than being hired as a cab driver in those circumstances only less income stability.
But then again, if nobody is profiting from this and the only person getting any surplus is me, wouldnt it then mean I am the owner of something that creates profit? But then, the only thing that enables my car to make me profit is me being there and driving it, thus adding value through my labour.
What about other things where value is created "out of thin air" like lets say im a motivational speaker, or a psychologist or some other type of interpersonal skill that I could do on the go, but still have someone want to pay me for, am I still selling labour if it takes no means of production? Or is my knowledge/education a means of production? and if so, then isnt that a means of production that I already own?
Or is my time and energy my means of production? if so then how is that different? And if knowledge/education differs from time/energy - how? If i have no energy/time then i cant access my own knowledge and such cant acess the means of production?
These are all really great questions! First and foremost, they get at the complex nature of labor and how it has evolved since Marx wrote about it. Not everything is about concrete production on the factory floor, and not every commodity is necessarily a physical object that you can hold in your hands. This, of course, makes it hard to decipher what's really going on in the enterprise/labor process.
If you own a car and sell rides, then yes, you own both the means of production and the labor power in your one-person enterprise. In this case, your economic role might fit closest to an artisan. Artisan production was (obviously) quite popular in the pre-industrial modes of production. When capitalism began to develop, the artisan economy shrank considerably because it could not compete with the efficiency and scale of capitalist enterprises. That being said, you can definitely see such cases today outside of your example. An artist who maybe makes his own pottery and sells it, or woodworker who builds custom furniture. In these instances -- and in yours -- you are still selling a commodity. For the artists, it's their products. For you it is the service of transportation that you provide (and presumably a more personable experience than getting a ride from company or taking public transport).
Your self-run enterprise does not fit the capitalist mode of production because one of the prerequisites is the separation of the means of production from a class of people that need to sell their labor (workers). In other words, in your operation, you own your own equipment (the car) and do not sell your labor power to another party so that it may be used to create a commodity that then belongs to them. You own the MoP, the labor power, and the final commodity -- abstract as they may be in your case.
That being said, your non-capitalist enterprise still participates in a larger circulation of capital. You bought your car from a company, buy fuel from various vendors, and buy other means of production such as tools/services for maintaining your car.
The question of intellectual labor is interesting. I'm going off the books here, but my guess would be that your services as a motivational speaker, psychologist, therapist, etc. can still be categorized as labor. We should remember that labor is a commodity as well, and it is perfectly common to sell your labor to willing buyers (after all, that's what every worker does when they are hired by a company). Now, you could run your own enterprise for these professions as well, which probably reflects the scenario where you offer rides to people in your own car.
In the case of therapy, you may run your own practice, in which case you would hire workers with various skills to maintain and expand the scope of your service. At that point, you have become a capitalist, since you are buying labor power and using it to turn commodity X into a new commodity Y (though in that case it would be super abstract since we are talking about a social service). You have probably also purchased a building and all the tools and labor needed to maintain it, so you could say you do have means of production.
I think Marx and others would probably consider intellectual services a form of skilled labor. The only difference is that if you sell your labor to a company, they get to decide what to do with the value it generates. If you are your own master, that decision is in your hands alone. You are selling your labor in both cases, but in the latter situation you have more control.
TL;DR:
1. If you run your own enterprise and own your MoP, you aren't really operating within the capitalist mode of production, though your self-run business still uses the broader market to function. The moment you start buying other people's labor power and using the subsequent value that comes from it, you become a capitalist.
2. The uniqueness of labor power as a commodity is that it is the only thing that can create value "out of thin air." That's why it's so important to Marx. All labor creates value out of thin air. Sometimes with the aid of MoP, other times without. The question is mostly about who decides what happens to that value.
3. Energy and time are components of labor (if they are being used with productive intent). Education/knowledge (in some cases) determine the value of your labor, which is also a commodity. As with all commodities, producing and reproducing labor comes at some cost. This includes the daily stuff like food/shelter/clothing, but also long term costs like education.
Sorry for the *really* long response. I hope this clears some things up for you! Please feel free to ask follow up questions!
What you're really selling is your time.
The best short summary of value theory I've seen. Thanks
i have to thank you. i was brought here by a guy that i was asking about socialism.
Awesome video. We need more videos like this that explain marxist ideas in a very intuitive and easy to understand way
I find his approach difficult to quantify.
I created a better expression of the Marxist sentiment about 'exploitation' which is much more useful from an engineering point of view.
(There is the owner and the employee.
Ultimately, the 'Employee' makes the products, takes those products to the market, sells the same products, he made, to himself and finally he pays a fee known as Profit to some 'Owner' for a permission to own the same products he made and sold to himself.
The owner gets to collect profit for doing nothing.....and many call that 'earning' instead of 'taking'.
The relationship is PARASITIC in nature, not SYMBIOTIC nor COOPERATIVE.
For the 'owner', the 'employee' is a cost that must be reduced or eliminated.
For the 'employee', the 'owner' is an obstacle preventing access to what the 'employee' needs to survive or prosper.
THERE IS NO SPACE for anything "voluntary" since those are diametrically opposite interests. All labor is done by the 'employee', the 'owner' just receives 'Profit' for doing absolutely nothing … and some call that 'earning' instead of 'taking'.. ...or "passive income", etc.
Some individuals are more 'owners', others are more 'employees'.
Some individuals are mostly 'owners', others are mostly 'employees'.
Some individuals are just 'owners', others are just 'employees'.~
The free trade and free markets inevitably result in few 'just owners' and vast number of 'just employees'.)
thnx man. helped a lot. love from india
Dude! I love your channel! I'm constantly saving your videos to reference sources.
In terms of exchange value, does the worker really create "surplus" value, or is it simply that some of the labor-time he puts in isn't accounted for in the wages?
Only the music was a bit annoying. The rest of the video is perfect. Just perfect.
"The worker produces more in value than he is given in monetary compensation." (4:19)
You mean, the worker doesn't get to pocket the full $5 sale price of each t-shirt he produced.
That's because the worker did not produce "$5 in value." He produced a t-shirt.
There is no $5 until the t-shirt gets sold.
For that to happen, someone has to go out and find a customer and make a sale.
Acquiring new customers can be costly and time consuming. People don't do that for free.
So each shirt's final $5 sale price has to cover both the making of the shirt and the selling of it.
And that money gets divvied up between the worker and whoever acquires the customer.
Ahahah those who go out to make a sale are called sellers and are also workers.
Imagine thinking you could disprove the most influential scholar ever with a stupid comment on UA-cam 😂😂😂
Cope harder.
I think there's one point that needs further elaboration. Some people (including some self-described Marxists) tend to say that all the surplus value belongs to the workers who created it on the assembly line. But in reality, our society, and the manufacturing cycle, are very complex, and the "surplus" has to be shared with all the workers, not just production workers, but also transportation workers, sales workers, advertising workers, bank workers etc... And of course, lets not forget the parasites who expropriate - the manufacturing capitalists, the bankers, the landlords etc... In summary, in our current capitalist system, the surplus is a social product that is expropriated by the capitalists, but the surplus should be used to benefit the whole of society - free education, free medication, free housing, free public transportation etc...
very well done, this is a very goood intro, good graph, and data to study this concept. If people can add CC in this video (or the entire series), this will be revolutionary for all people arround the world to learn nore about marxism.
Cheerzz from Indonesia.
Thank you this was very informative! I heard this thrown around a lot and wanted an explanation.
How much labor does a portrait painter apply 2:02
These video are incredibly helpful and act as a great study aid for anyone starting out in their Marxist studies, as well as refreshing as I am doing. I enjoyed this video in particular for the simplistic explanation using an easy to understand commodity but also connecting it with the actual realities of capitalism and showing that inequality is symptomatic of capitalism - as you said, it IS the system. This helps to understand class consciousness too, given that we should expect the bourgeoisie to act in accordance with its interests as a class and for the political parties to represent those interests through the "liberal democracies" or "constitutional monarchies" which serve this mode of production. This helps us to get down to the science of the issues and shows why Marxism is necessary to defeat the social ills which are seen as moral issues by those who are trapped in idealistic ways of thinking. You see so many liberal bourgeois commentators talking about "making capitalism work for everyone" (I intended a joke of a seminar run by a popular economist called "Transforming Capitalism" and, as you can imagine, the answers to their questions are already there, in that scary ideological framework known as "Marxism"!), yet we know that the integral nature of the system has not changed and cannot change. One of the most difficult aspects of Marxism IMO is political economy which forms such a crucial part of the science, and part of this is the density of Capital - even though its thoroughness is part of its brilliance - and so being able to understand these concepts in relation to our current historical stage within capitalism is highly necessary IMO and you manage to pull that off very well in this video.
Kudos comrade!
With thd chart from 1973 onward, in 1971 nixon removed the gold standard, and further enforced statae capitalism which devalued the currency only the state was legally allowed to produce. So, while wages did stagnate, wages also lost value over time as well.
The thing you neglect to mention is that it's a two way street. The business owner wants to pay the workers as little as possible but the workers want to be paid as much as possible. This sets wages at equilibrium.
Thanks for your comment!
How and where do you see workers being able to affect their wages? If you are referring to strikes and collective action, then yes, workers are able to have some influence on what they are paid. But this overlooks the main thesis of surplus value/labor, which is that a capitalist *always* pays his or her workers less than the value of their labor. Not because of some evilness or greed, but because not doing so would mean breaking even, i.e. not making a profit. The constant tug-of-war between the business owner and the workers will always stay within the parameters of profitability, aka. the generation of surplus value, aka. the use of some portion of unpaid labor in the production process.
@@themarxistproject I was specifically referring to the hiring process when wages are first negotiated. Perhaps people at the bottom like janitors, cashiers, cooks at fast food restaurants, and other low occupations wouldn't be paid a lot but other occupations, particularly those in the medical field, tend to pay very well. And what of all of the other costs of running a business such as utilities?
Sure, wages can be negotiated, but only on grounds established by the business owner.
Yes, there are certainly gradients in wages, especially from field to field. That, however, does not affect the presence of unpaid labor in the process of accumulating capital. Even high-wage sectors like IT and medicine still pay their workers less than the value of their labor.
The non-labor costs of running a business are constant. Not because their prices are fixed, but because the business owner cannot generate new value from them. Their value in the production process remains the same. Their function is to facilitate the part of the production process that does create new value: labor. As such, a business owner cannot get utilities or the means of production to produce a value above the value he acquired them at. This is why Marx treated those costs as part of constant capital, and labor as variable capital.
Say I was a business owner who wanted to sell cars for a profit. I've bought the facility, the tools, and the raw materials needed to actually make the cars. The sum cost of all those things is $100,000. I have yet to buy labor to make anything meaningful out of the things I have invested in. As it stands now, without the addition of labor into the equation, the value of everything I have acquired is basically the same (prices may have fluctuated based on changes in the market, but I am unlikely to find a way to sell off my assets with any profit margin). In order to make something of my investments thus far, I'm going to have to buy labor so that it may bring all the pieces together and impart into the final commodity value that did not exist before work was put in. If I pay my workers a wage equal to the value they've given me in the working day/month/year, I am once again breaking even (or in the worst case, losing money). My only option is to compensate the workers below the true value of their labor. I may very well still pay them a "desirable" salary, but it would still have to be below the value they've produced for me.
I hope this cleared some things up. You're probably better off tackling Marx's Capital (Vol 1) for a deeper exposition of how this works. Alternatively, I would suggest "Wage-Labor and Capital" or "Value, Price, and Profit," if you want shorter works.
Hello, Can you do a comparative video on Subjective Theory of Value (STV) And Labor Theory of Value (LTV). I think this is crucial. Because many consider value to a subjective affair or of Demand & Supply. For example a religious person may consider "Holy Water" to of immense value. But for a non religious person it's just water. And In some places certain items have more value due to scarcity, this is especially true of antiques. Even a copper coin of 2000 yrs old have more "Value" . So What makes LTV ? I can see the power of LTV in Social Analysis. But other than that does it have any use ?.
I think the difference here is between price (how much a capitalist can sell a commodity for, which can be manipulated by advertising) and use value. Some things will only be used in a certain context, such as a sewing machine only being useful to a person or firm that sews but having no use value, and thus no exchange value, to a person or firm that doesn't. Thus, the Holy Water would have a use value to certain religious community but not to others or non religious populations. However, the commodity is that object that is produced by human labor for the purpose of exchange, so if Holy Water is being produced, and it has a use value, but doesn't get sold, it is not subject to the commodity form. Hope that helps, sorry no one was able to respond before now :)
You can look at it from consumer prespective as well. There is always surplus that is extracted from consumers....Which often cant run itself in long run.
Because you got people who will turn old, people who will earn low wages, people who lost their job to automation, people with no healthcare, etc.
Used this for my capitalism, race, & technology class. Thank you so much! I subscribed :)
I find his approach difficult to quantify.
I created an expression of the Marxist sentiment about exploitation in a much more useful way from an engineering point of view.
(There is the owner and the employee.
Ultimately, the 'Employee' makes the products, takes those products to the market, sells the same products, he made, to himself and finally he pays a fee known as Profit to some 'Owner' for a permission to own the same products he made and sold to himself.
The owner gets to collect profit for doing nothing.....and many call that 'earning' instead of 'taking'.
The relationship is PARASITIC in nature, not SYMBIOTIC nor COOPERATIVE.
For the 'owner', the 'employee' is a cost that must be reduced or eliminated.
For the 'employee', the 'owner' is an obstacle preventing access to what the 'employee' needs to survive or prosper.
THERE IS NO SPACE for anything "voluntary" since those are diametrically opposite interests. All labor is done by the 'employee', the 'owner' just receives 'Profit' for doing absolutely nothing … and some call that 'earning' instead of 'taking'.. ...or "passive income", etc.
Some individuals are more 'owners', others are more 'employees'.
Some individuals are mostly 'owners', others are mostly 'employees'.
Some individuals are just 'owners', others are just 'employees'.~
The free trade and free markets inevitably result in few 'just owners' and vast number of 'just employees'.)
@Nick White That labour, often intellectual labour, is done mostly by other workers, including ones long dead. For the immediate living labour, it is surveying, researching, creating models, visiting plants, doing engineering, communicating with lawyers, contractors, writing reports, etc etc. Now the owner may be one of those doing this also, or he may even do more than any other in those tasks, but in principle he doesn't need to in order to be the owner and make a profit. That is why there are owners who don't do anything, some who do a little, and some who do a lot. But the worker in principle would not be the owner and still do what he is doing, he doesn't have the flexibility, he can't outsource it all.
There's a class for that? No wonder education is worthless now.
Your videos are really nice. Thank you, it’s a big help.
Productive and unproductive labour are worthy related concepts looking into for anyone unfamiliar. Some workers are definitely more of an expense than adding surplus value
After reading a few chapters from des kaptal, I still didn't truly understand how it works. Finally found an easy explanation!
This is one of the best videos I've watched on this topic. Thank you so much mann
How would you confront an argument that states that the difference between the growth rate of wages and productivity can be attributed to technological advancement as opposed to greater intensities of work?
Why do we have so few views for this amazing channel?
Good visualization of Marx's labour theory of value! We are a small team in Hong Kong and have also tried to explain these Marxism concepts in the form of short animations. Our latest video has English subtitles, and we're looking for constructive comments as well!
These videos are so good! Especially to study Marxism!
can you recommend us a book about primitive accumulation and how wealth and power concentrated in the hands of few so they can use that accumulated wealth as a capital to exploit again and again ?
good vid except for the part where you said the capitalist isn't greedy
A great video that explains all of this, in mathmatical form, is Political Economy by A.G.Kolikov.
Well explained. Thank you.
the graph of wages vs productivity at the end is interesting - was 1973 also the end of gold standard /beginning of inflation of paper money? hmm🤔
You argue that everybody would value the commodity as the original seller does? That everybody values everything equally? That value is objective? Upon what grounds?
I think the misunderstanding here is more semantic than anything. In Marxist theory, the value of a commodity is not quantifiable, per se. It's a pretty abstract concept. I would suggest you read more on that (Capital Vol 1 has a lot on this matter). Alternatively, check out the videos on the commodity and commodity fetishism on this channel!
Marxists acknowledge a difference in "use-value" between the buyer and seller. Marx actually talks about this, noting that for the capitalist selling the commodity it's use-value is just a means to realize profit. For the buyer of course, the use-value is whatever the commodity's function is designed to be.
Exchange value is based on the quantity of labor put in to the production process. Labor is the only thing that unifies commodities, it's the common denominator. Again, see the other videos for more on this.
Exchange value is *not* price. Orice fluctuates around the value of the commodity. This is why some pencils might cost more than others. Commodities are obviously subjected to market fluctuations, changes in supply and demand. The difference in intrinsic value, however, is observable in, say, the difference between the average price of a car and the average cost of a pencil. Supply and demand alone cannot explain why cars on aversge cost more than pencils. When supply and demand are in equilibrium, a car is still going to cost more than a pencil. The reason for this? It takes more labor on average to produce a car than it does a pencil.
@@themarxistproject supply and demand depends on the maximum people are willing to buy x the maximum people are willing to sell. buyers will pay more for cars because they are more useful than pencils, and sellers won't take less because it wouldn't be profitable. labour value does not explain why a league football player earns more than a miner. it takes way more labour to swing axes for hours in a hot mine than it does to kick a ball to the other side of the camp. why the player earns more? because many people can an would swing an axe a few dollars/hour, but only a handfull can play like Messi and most football teams would pay millions to have someone who can.
Cars may on average be more useful than pencils (though that depends on the situation), but you could say that staple food items are even more useful than cars or pencils, and yet they are (mostly) cheaper than cars. Again, at equilibrium, the *average* price of a car will always be greater than the average price of a tomato, and that disparity is best understood as a difference in labor input.
The question of the football player is an interesting point. Much like art, we sometimes observe a massive gap between the labor input and the final going price of the commodity. However, those instances are statistical outliers and do not fit well into a discussion of averages. Picasso's paintings may sell for millions, but millions of average commission pieces or works of art sell for a very careful measured amount of labor put in to them. As someone who has done freelance graphic design, I can tell you that for the vast majority of creators, the amount you can charge for your work depends heavily on your labor (both in terms of training and average input).
As I believe I mentioned earlier, Marx acknowledged that price is subject to supply and demand. Value in Marxism is kind of a confusing concept because it's fairly abstract and isn't necessarily metrically quantifiable. That being said, value's role is in explaining an underlying similarity between all commodities as products of labor, whose price on the market reflects a socially necessary labor time associated with their production.
Yes, but when the cost of inputs (example: labor) decrease, supply increases, and when income decreases (example: wages), demand decreases. The net effect is a decrease in the equilibrium price.
Simpler: yes businesses wish to lower costs of inputs and maximize prices, but they must also maximize quantity (total revenue = price * quantity); if demand is elastic at the current price, then total revenue will increase when the price is lowered, so there would be a downward pressure on prices. Similarly, if each business decreases wages, people would buy less, and the aforementioned effect would occur.
Overall, the current wages given prices, or the wages given “abstract,” “unquantifiable,” “labor value,” doesn’t seem to matter as much.
You also don’t seem to mention quantity very much.
Pre-midterm ECON 101 stuff.
My question to you: does the total value in the market increase after the production of a commodity?
If the worker who makes t-shirts, stopped working after 4 hours (earning 20$), the output of t-shirts would decrease from 8 to 4, and if we use the same rigid mathematics as in this video, the price of each t-shirt would consequently rise up to 10$ due to a lower supply of t-shirts. Which means, for the capitalist, that sales revenue would still be 40$; and for the worker, that he must purchase more expensive t-shirts for the same salary as before. In other words, his standard of living has decreased.
If we on the other hand increase the workers' salary from 20$ to 40$ at 8 working hours, the price of t-shirts will be raised accordingly to 10$ due to customers increased purchasing power, and there will be no increase in the standard of living. Except, in this scenario, there is no means to maintain capital, and as machines wear out, one will not be able to maintain output. Thus, in the long run, the standard of living will decrease.
The third option (to comment on your last point), would be to increase the worker's productivity-through capital investment-from 8 t-shirts to, let's say 16, and if wages stays the same, 20$, each t-shirt would now go for 2.5$. Which means that the standard of living has increased.
The point here, disregard of how statistics can be used for anything, is to ask who consume all that increase in productivity if not the workers. Increased output is what increase real wages, i.e., we get more stuff for the same amount of money. That's why we today have PCs, phones, freezers, stoves, cars and many other products as opposed to before when these products were reserved for the rich.
Which brings us to the gap between rich and poor. The gap might be big in terms of assets and capital. However, these assets are locked into production which employs us and produces all the goods and services that we enjoy. Which again mean that, in terms of living standard, the gap between rich and poor is smaller. I.e., both rich and poor enjoy these same products, PCs, phones, etc.
(Bear in mind that economics is not this rigid and straightforwardly as I have not accounted for economies of scale, and how every marginal unit added to output affect prices and the maximization of profit).
Engineering lad here ! You just helped me complete my sociology assignment dude. I was a goner if it weren't for you and a few other dudes on youtube.
I don’t know how surplus value would work as there is no definitive price to labour? the value of labor is subjective. There is no set objective "amount that they produce." A worker in a mine is not solely responsible for production. He isn't financing the operation. He didn't bring the equipment. He didn't transport it. He didn't refine it or market it. several people went into producing x thing. please explain.
Great channel!
Thank you so much! that was a very helpful video.
Brilliant analysis!
What the name of the Music???❤❤
Wouldn't a capitalist argue that the inherent value of a t-shirt is 40 (20 materials + 20 labor), but due to the law of supply & demand they are able to apply a considerable profit margin on top of that, by selling it e.g. for 100? The question would follow of course why the worker wouldn't deserve a cut from those profits, but the point I'm trying to make is that the t-shirt still costs 40, it's not like a value of 100 is produced directly. Though I don't know if that makes a difference at the end.
Wages are generally considered an expense. Profits are revenue minus expenses.
Workers don't get a cut of the profits, they get a cut from the revenue.
The profits generally are either reinvested or go to the owners or shareholders.
A worker can also be a shareholder, thus could get a cut from the profits.
Excellent break down
Where does the $20 profit come from? From Marxist Paul, the profit also seemed doubled, so is profit always the same as the wage?
That was a great explanation. Thank you
Thank you sir for excellent lesson
I am going to sit exam after 2 hours
هل من وسيلة ربما رقمية بتقنية البلوك تشين
كالعملات الرقمية مثلا لكي توضع كمقياس لقيمة عمل الأفراد كوحدة واضحة كالمتر
والغرام والفولت تقيس القيمة بدقة أو بتقريب أو بمؤشر وتوضع في رصيد أممي متفق عليه عوضا عن الأوراق المالية فتجربة ورقة 100 دولار باتت واضحة في فضحها لوهم قيمة الورقة المالية التي ضحكوأ علينا بها وهي لاشيء الكل قدم خدمات وسلع من عمل بها وعادت لصاحبها
The point shere productivity and wages split is where the usd went off the gold standard....
That’s total BS, wages skyrocketed after WW2, long after we were off the gold standard.
@xxyyzz The US was taken off the Gold Standard in 1933.
thank you for teaching youngsters, and maybe you should be more audible when you record your voice
Thanks for the comment! The audio has been a pretty consistent issue but I hope to be able to improve it with time.
Hey, great video! I have a couple of questions:
Would a completely automated factory not produce any profit then?
Is it possible to divorce the labor theory of value from relative prices and just use it as an explanation of the source of profits, capitalist exploitation, and capitalist contradiction?
Yes, according to Marxist theory, full automation would not be able to create any new value. You could maybe secure profits by maintaining the price above the value of the commodity....but that's probably not sustainable in the long run.
I suppose so, though I can't think of any instance where that's been done. The LTV is definitely more of a theoretical tool than a practical one. And after all, it is the labor theory of *value*, not price. So I'm inclined to say yes, you can probably separate the two.
Isn't price the reflection of value of commodity? And in turn, the value of commodity is the abstract labor manifested in it? How can we divorce the both?
It's relative to the demand of the commodity in the market. As long as commodities are being rendered to the consumers and there are people willing to pay for that stuff (Like food lol) then a fully automated means of production can still produce "valuable" commodity.
@@themarxistproject Many products nowadays are created mainly through automation, precisely because it is more profitable than physical labour. The truth is that the more labour something requires, the less profitable it becomes, since you have to pay the worker more. By marx logic, we would still have shoe shiners, and light holders instead of lampposts and those people would make just as much as a car factory worker.
i completely disagree with the ideas of this video, as i have put in a few reply sections, but this was a great video anyways, thank you for the explanation
Hi Davi! Thanks for your comments! It's always good to have disagreement without incessant name-calling, which is sadly the way ideological clashes tend to go. Your responses are very much appreciated.
Where does price come in? How does prices form??
Thankyou so much sir, you explained very well. ⚘
Hey.. thanks for the video. It's really good. Can you do one video about the critics of LTV and its responses?
I'm really looking forward to one such video. Keep up the good work!
The thing missing in this is risk. Wages function almost like a futures contract between workers and the capitalist.
Say a worker got the full value of their productive capacities and the capitalist is not making profit. What happens when sales drop for some reason? If the end product sells for less or is sold less, then that would mean the labor is now worth less. So the worker would be compensated less but would have still invested the same amount of hours. This is a risk that the employee takes on under this arrangement.
So an employee that doesn't want to risk a 40/hr week investment and still not be able to pay the bills, may make a contract with the capitalist to get an agreed upon and consistent wage to mitigate any risk.
Now the capitalist takes on all the risk because if sales decline for any reason, they still have to pay that agreed upon wage and eat the losses. But along with that risk, they get the opportunity to gain profits if sales ever go up.
So when you factor in risk, you can see that the surplus value is really just an insurance policy that the worker pays for a guaranteed sell price of their labor in the future.
No, if sales decline, capitalists start to fire workers, decrease wages and increase working hours, and the only thing workers can do about this is quit on their own.
Nice explanation. But my mind was going back to the background music more, there's no need to add music I think
Great video, I failed to really grasp this topic before that.
How to abolish the theory of value in socialism?
What if we couple wage with productivity? would that help?
How do we measure productivity reliably?
This is a great summary, but I just can’t agree with the theory. For one the model ignores the initial cost of capital, it just assumes capital exists. I also feel like there should be a distinction between surplus value the capitalist can take as income and the sv used for expansion.
I also think it’s simplistic to say that LP is the only thing that adds value to a commodity when there are multiple necessary components
Thanks for your comment. To respond to some of these points:
1) Ignoring initial costs is fairly common practice in most economic theories. Working with net products / value-added terms allows the model to focus on what is actually being produced. This is not really unique to Marx.
2) There is a distinction between the uses of surplus value as income for capitalists and surplus value as a means of expanding capital. Marx elaborates on this quite substantially in his discussion of simple and expanded reproduction (there is a video on the channel that covers precisely this issue).
3) There are other inputs in Marx's model, apart from labor, which impart value into the commodity. Value is added to the commodity from capital as well. All capital inputs (raw materials and machines), however, are considered as "dead labor", meaning they originate from earlier production processes, and hence from past labor (regressed through enough steps backward in the value chain). The point is more that only labor can create *new* value. Labor is the primo genitor of all value that is produced in economies. Still, some portion of a commodity's price reflects the value added by non-labor inputs. Marx always recognized this.
Depriving the necessities, needs and demands of workers.
Main weakness is the claim that labor is the sole source of value. If a machine costs $X and produces Q output and a new machine costs $X and produces 2Q output, wouldn't the new machine be twice as productive? Here we assume the worker does the same amount of work, but technology changes.
The example you just provided doesn’t disprove the value creating property of labor lol. Machines are mechanical substitutes for producing and applying labor, except a capitalist doesn’t have to continue to pay wages for the machines labor, except for maintenance. No commodity could exist without labor, and is more essential than anything else
Machines aka fixed capital aka dead labour. Got it?
Relevance of Karl Marx in the Indian context please. One video on it
Great vid !! What's the tittle of the song ?
Thank you!
The song is from the UA-cam Audio Library. I believe it's called "From Russia With Love."
@@themarxistproject sounds kinda like dance of the nights by prokofiev
Very striking music. It’s like inverse Dance of the Knights. Night of the Dance?
I know this is 3 years late but I think it’s Montague’s and Capulet’s by Prokofiev
I regret to say that the piece is not “The Dance of the Knights.” It does resemble that, however, it is not that. I’ve dived into the comments with the hope that I’d find out the name. Will write when/if I’d found it.
Song name?
thank you for explaining
This is one of the fairer videos I've encountered on Marx, yet I still find an issue with the implication that the capitalist always profits from the labor of a worker. That's obviously their goal but it's one that isn't always realized: the capitalist invests with hope, not a guarantee, of a return of investment. The capitalist gambles on the worker. Not every t-shirt produced is a t-shirt sold. In many cases, a worker's output is variable and difficult to predict yet they get paid an agreeable sum, and sometimes while the business is bleeding money left and right.
I also find that no matter how distasteful we find a capitalist's profit incentive, it's difficult to come up with a system that ensures that workers are paid more. I've even seen multiple cases where people working in voluntary co-ops attest that they are typically earning less than they otherwise would. That seems to harshly contradict the idea that capitalist business models are underpaying their workers. They might enjoy the working conditions of the co-op more but it doesn't seem the case to me that alternative business models sharing the means of production will actually translate to pay raises for those who share in the MoP.
Yeah I was thinking the same here. Also is there no such thing as a fair profit? I can understand the gross exploitation of workers in less developed worlds, but if a capitalist takes the risk to invest in the cotton and the machines of production and then pays their workers a fair/predictable wage is surplus value not at least somewhat justified for that risk/paycheck promise? Where is the issue here, am I missing it?
@@nightoftheworld how much is a risk worth?
@@skepticalwendigo3702 Firstly, I believe workers should be paid/subsidized/educated more fairly-which there is a lot of latitude in “fairness” (by who’s standards.. Unions? Corporations? Governments?) My point is that there are _many_ people who don’t want to face the dynamic conditions of the market everyday and so rather than make their way into that world of greater contingency they choose instead to stay beneath the shelter of an employer, who absorbs many risks of shocks and seasonal slowness etc.
Yes the market is race to the bottom in many ways which has been terrible for workers, great for big pig capital owners-but I think taking risk is something noble if done right. In fact even the Bible in the _Parable of the Talents_ (25:14-30) says that we should not bury our money in the ground, but put it to work in the world: _”from those who do nothing, even what little they have will be taken away.”_ Almost anyone can get a loan if they have a good idea and business plan, but few have such confidence in their plans to risk the gamble, for those that do and succeed I think they deserve some amount of surplus for that legwork/sweat.. but does that mean total compensation should be 150x their base worker-hell no, that’s an illness.
@@nightoftheworld you make it seem like as if everyone has a fair shot at making it if they just contributed to the gamble. Because in gambling I think you’d know that in casinos they aren’t really well known for being fair or truthful.
@@skepticalwendigo3702 don’t be silly-it’s all risky, the fairness is in the freedom to fail in pursuit, the unfairness is in how much privilege one has assisting/informing their decision making here-but too much equality is also bad.
There are many problems, some now glaring like feminine liberation/BLM/tax havens-but I think the ultimate oppression is you stomping on any sparks of ambition here, deterring people from even trying to become involved by suggesting essentially that average people have no real shot in this world, that it is casino odds in here. No way-much more flexibility and opportunity than that, especially with one sharpened idea, it’s more open than you hyperbolize.
I think there is an aspect of falling in love with blaming everything but oneself that is the leading cynical position today. Like Zizek says, the Marxist dream of decaffeinated capitalism, of a revolutionary subject coming along to free us from our chains is *dead* which means _wake up and fall in._ The capitalist appropriation of the ‘68 emancipatory project by ex-hippies like Jobs/Gates is exemplary.
Humanity has been trying to see itself more fully in the mirror of history, but it always involves contradiction, it needs our help to become more fully and ethically responsible, and that means working through the shit, even if it’s impossible.
The problem with this is:
The worker is not producing the value by themselves.
The worker is also leveraging the resources of the company they work for.
Eg: The physical assets of the company, the relationships it's built up, it's reputation, it's design, it's customer base, etc.
Why is a t-shirt worth more than the fabric it's made of? Why is a cell-phone worth more than the sum of its parts?
The answer is labor.
Great video sir
great video
It is worthy to note that 1973 was the year when Nixon ended the Bretton Woods system.
Business runs net zero profit -> no capital to reinvest and expand/compete -> business dies, workers unemployed
"no capital to reinvest and expand/compete" - this is another point to be presented, but the basic idea is under socialism workers decide how the company is run. So the democratic manager, executive or the leader of the business will have to convince workers to basically donate money towards the business to fund the expansion, innovation, research or whatever. In other word, worker democratically willing to lower their wages to reinvest into the business. The workers will be compensated for their investment if the consumers values the business product more and is willing to pay higher due to better functionality due to innovation, higher demand through expansion or whatever. In short, the investment of the workers pay off if it increase the values of the product they are producing. Higher values means higher wages. Ultimately, the "capital to reinvest and expand/compete" will comes from the investment of the workers of the company.
How does Marx acknowledge demand for the commodity? Labor may be what adds value to a commodity in production, but how do we determine the worth of that value?
Luv the info but music is distracting(
Nice vid, but why the authoritarian music?
you earned a subscriber from a capitalist
Bezos brought me here
Workers. Exponiential more value when workers are combined.
Love from India...
9:16 actually its called reagonism
I like how capitalism has pulled more people out of poverty and has consistently caused the societies its been implemented in to flourish but people still find obscure ways to find flaws.
You really thought you said something here, didn't u
"Pulled more people out of poverty" haha, caloric intake was on average, higher in the Soviet Union than the US. "Obscure ways to find flaws" only obscure cause you cant look at the glaring problems right in front of you
@@okthen3583 ok whats the solution?