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Reading Capital, Volume II

by Isla Pawson on April 24, 2017

A year ago, while I was studying for Honours, I would never have foreseen volunteering to read a 500 page volume of Marx’s work in my free time. But a week after I completed my thesis, at a local bar on a Friday night, I found myself eagerly agreeing to take part in a reading group of Capital, Volume II – presumably under the influence of something other than adrenaline.

Over the summer a small group of political economy students, graduates and tutors, endeavoured to read what is widely understood as Marx’s most dull and difficult work. I think we all hoped to at least partially disprove commonly held views about the tedious and unrewarding nature of the book by finding some untapped potential hidden away in the chapters. But most of us were left feeling disappointed and somewhat defeated, bogged down in intricate theoretical detail and without a sense of the bigger picture – a contrast to the experience of reading Capital, Volume I, which a number of the group did last year, see HERE.

I have to admit that we faltered at the last hurdle and failed to complete the final section of the book. In spite of our incomplete reading, a number of the group have here provided their insights, misgivings, and questions regarding our experience of reading Capital, Volume II.

Isla Pawson – Research associate and Honours graduate

At University, I read a little about a lot, but I’m ashamed to say that I rarely finished an entire journal paper, let alone an academic book. It is embarrassing then that one of my first proper engagements with Marx – a founder of my discipline – was by reading Capital, Volume II, all but after I had graduated.

I would describe reading Capital, Volume II as akin to blind faith – wading through a swamp of arithmetic and expecting to find nuggets of pointed, far reaching analysis, based on an enduring belief in the value of Marx’s political economy. But the nuggets, I thought, were few and far between.

Capital, Volume II focuses on the problem of realising surplus value, disrupted first and foremost by time and distance. As Marx puts it, ‘during its circulation time, capital does not function as productive capital, and therefore produces neither commodities nor surplus-value…capital’s circulation generally restricts its production time, and hence its valorisation process’. This point highlights that production time and circulation time are ‘mutually exclusive’, with circulation acting as a ‘check’ on the repetition of the production process.

One visible implication of this is the spatial restructuring of export production centres, with industry increasingly clustered outside of urban centres close to motorways and airports in order to streamline circulation – chiming with Saskia Sassen’s analysis in The Global City.

Another implication is the growing role for a credit system that enables production to continue throughout the circulation process. Credit can be used to bridge the gap in situations where surplus value has not yet been realised and under conditions where capitalists expect future consumption of their goods and services. This may seem like rather a banal point, but it has real consequences for how the economy functions, illuminating a systemic reliance on ‘fictitious’ capital (although Marx only deems it ‘fictitious’ later in Capital, Volume III). Money values backed by yet unproduced or sold goods and services are thus the essential lifeblood of capitalism, rather than an eccentric or irregular consequence of an otherwise self-reliant system.

Most interesting to me was how Marx evacuates almost every trace of politics from the volume, only ever hinting at the institutional apparatus that manages the circuit of capital. This is replaced with an acute focus on the internal dynamics of production and exchange in isolation from social or political concerns – a view of the economy ‘abstracted’ from its real environment in order to capture its fundamental tendencies.

One of the more helpful things I got out of this was a Marxian conception of how and why demand matters, a point often considered the primary domain of Keynesian economists: ‘Contradiction in the capitalist mode of production: the laborers as buyers of commodities are important for the market. But as sellers of their own commodity – labor power – capitalist society tends to keep them down to minimum price’. Here, Marx provides a social basis for what later became a Keynesian theory of crisis and stagnation, precipitated by inadequate aggregate demand. For Marx, aggregate demand for products of the real economy will fall as already-low wages are pressed and restrained in order to unleash profitability. Today, the consequence has arguably been a turn to accumulation through financial assets and/or real estate where values are not hinged so intricately to production and wages and are based on an altogether shaky belief that credit will continue to inflate their values in place of long-lost wage growth.

None of this is there for the taking in Capital, Volume II, and that’s probably why we didn’t make it the whole way through. The book requires reflection in spades, and I doubt I’d have made it past the first chapter had I been without the unique discipline a weekly discussion group brings. Marx’s version of the modern-day business studies textbook is not exactly a nail-biter – but, if you try hard enough, small parts of it can catalyse thinking about economic problems and their wider social and political implications. While the book did not live up to my expectations, it contains traces of the timeless relevance that we know Marx so well for today.

Matthew Ryan – Postgraduate student

When I was 11 years old I hubristically attempted to read J.R.R. Tolkien’s The Silmarillion. From memory, I managed to wade through three or four chapters, but was quickly defeated. Later in my literary development I returned to the text and was somewhat more successful – I now count the work as one of my all-time favourites. In my reading of Capital, Volume II, I am still at the stage of the overwhelmed 11-year-old: our reading group struggled through the first two parts of the text, but could not manage the third.

Analogies can be (and often are) taken too far. I do feel, however, that we can usefully compare The Silmarillion and Capital, Volume II, beyond the fact that they both flummoxed me at different times. Let me explain.

If a reader approaches Tolkien’s Silmarillion expecting to find a compelling narrative structure, or easy-to-read prose, then that reader will be disappointed. Labyrinthine sentences abound – I opened the book to find an example, and was immediately greeted by a seven-line sentence, featuring three semicolons. And rather than featuring a continuous story, following the adventures of nine intrepid Fellowship-members, à la Lord of the Rings, The Silmarillion features a sometimes monotonous barrage of mythology, which gives paragraphs of background on a particular god or demi-god, before moving on, and never utilising that character again.

Similarly, Capital, Volume II is difficult to read. Marx will often use extended arithmetical examples for seemingly-obvious points, while slipping crucial points of argument or analysis in amongst these explications. Far from the clear, signposted, and oft-repeated thesis development we are accustomed to today, Marx forces the reader to sift through, line-by-line, lest a crucial step be missed. And while I am certainly no mathematician, I do not think that this criticism represents my own mathematical illiteracy – at the end of one of these labyrinthine passages sits a footnote from Engels that explains that this particular example was actually filled with inaccuracies, and that Engels thought the point being made was rather mundane.

This does not, however, mean that we can ignore this text. Far from it. If one can push past the difficulty of the text, then that person will be rewarded with the foundation for a theory of crisis in the capitalist system, particularly through a nuanced understanding of the way time interferes with the circuit of capital. Where Capital, Volume I has a focus on the realm of production, Volume II moves to consider the sphere of exchange. In the very first page of Volume II, Marx makes this abstraction explicit. Having just spent the entire first volume problematising the relationship between price and value, Marx states ‘we shall therefore assume here . . . that commodities are sold at their values’.

This change in vantage point is crucial. The implication is that by only ever reading Capital, Volume I (as is far too common), we fall short of understanding that production and exchange are in dialectical relation: ‘The unity of production and realisation, like that of the commodity, is a contradictory unity: it internalises an opposition between two radically different tendencies. To ignore its contradictory character would be like trying to theorise capital without mentioning labour, or gender by talking about men and forgetting about women’, states David Harvey in his A Companion to Marx’s Capital, Volume II. Here Harvey is arguing for the necessity of reading Volume II. The introduction to this Companion reads like a pep-talk: “Capital II is going to be hard going, but stick with it! It’s important”.

Even with David Harvey’s encouragement in mind, we did not manage to complete the text. Perhaps, like The Silmarillion, an unsuccessful first reading will be the preface to a life-long interest in the text. Whether I (we) will return to the text for a more-fruitful second reading, time will tell.

Rhys Cohen – Tutor and Honours graduate

If this reading group had a catch phrase, it might have been ‘but what about transport?’, usually followed by a chorus of groans, laughs and dagger-eyed glances. The issue of productive vs. unproductive labour was (unsurprisingly) never resolved during our truncated reading of Capital, Volume II. And the examples of transport and communication were a constant reminder of my frustration with the theoretical contortions deployed to protect that most precious of things: the labour theory of value (LToV).

Normally I wouldn’t get too hung up on such things. There are far too many other interesting and useful areas of the Marxist framework to focus on. It felt almost petty to keep bringing these questions up when some other argument or line of reasoning appeared to contradict our work-in-progress understanding. But there seemed to be little else to do – chapter after chapter was dedicated to specifying, in intricate and confounding terms, where the line between productive and unproductive labour should be drawn.

Perhaps we were hampered by our desire to understand the contemporary implications of the framework. The questions we had about the LToV that came out of our discussions on transport were tricky enough. But we quickly found that the infinite replicability of digital resources presented even greater problems.

My confusion can more easily be attributed to ignorance than to any faults with the text. But I am sure those more scholarly than I have thought along similar lines. A senior academic once pointed out to me that only Marxists spend years of their life trying to solve the transformation problem – the mainstream don’t care, and neither does anyone else.

The LToV has rarely been ‘useful’ in a traditional problem-solving sense. The indelible mark the theory has left on the world is not due to some mathematical proof. It is the political and, dare I say, ethical power of the arguments that spring from it. But what do I know? I haven’t even finished the book.

Isla Pawson
Isla Pawson graduated with First Class Honours and the University Medal in Political Economy from the University of Sydney. She is also the recipient of the 2017 Journal of Australian Political Economy ‘Young Scholar’ Award through which she is continuing her research into the political economy of housing, alongside working as a Research Associate in both the Sydney Business School and Faculty of Arts and Social Sciences.

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