Das Kapital

Under the labor theory of value, labor is what truly creates the value of any product, not how it is used or its characteristics. In Marx’s words, a commodity is “simply the material shape taken by a given number of hours or days of social labour” (297). This theory did not originate with Marx, but with the 18th-century economist Adam Smith. For Marx, this is proven through the fact that the means of production (e.g., tools, the workspace, etc.) have a value that is predetermined and fixed, which is why Marx calls this “constant capital.” Any new value has to come from variable capital, which is how much is spent on a worker’s wages (317). Wages are variable capital because a capitalist can control and extract more value through lowering or raising wages, lengthening or shortening the workday, and so on. This is also what Marx means when he writes that “labour-power in general becomes a commodity” (951).

What makes this important for Marx’s analysis is that the only way for capitalists to extract more surplus value from labor is through their workers. Surplus value is the value that comes after the labor necessary for the worker to reproduce their own worth and the expenses that come from the means of production. It represents the profit received by the capitalist. While capitalists can only extend workers’ workdays so long to increase their profits, there is what Marx terms “relative surplus-value” (432). This is the value extracted from workers by forcing them to work as much and as hard as possible or by decreasing the number of workers at the same job. According to Marx’s theories, the goal of the capitalist is to extract as much value from the worker as possible since it is the labor that determines the value of the workers’ products.

The “fetishism of the commodity” is how Marx describes the fact that people typically view the value of a commodity as coming from its qualities and characteristics, not from the labor that produced it or from social relations (163). Marx describes it as when

the commodity-form, and the value-relation of the products of labour within which it appears, have absolutely no connection with the physical nature of the commodity and the material […] relations arising out of this. It is nothing but the definite social relation between men themselves which assumes here, for them, the fantastic form of a relation between things (165).

For this reason, Marx describes the phenomenon as “fetishism,” a word meant to invoke the “misty realm of religion” (165).

This system means that the price of any product is not determined by any kind of inherent worth. Instead, the price is determined by the cost of the wages (which is the real factor that determines the value of any commodity), any cost from the means of production, and social relations. Such relations would include the value of the commodity compared to other commodities but also how much the capitalist can charge to provide for surplus value. As the price of a commodity is more than what it is needed to compensate the capitalist for any expenses such as wear on the tools or raw materials, the price—after the cost of the means of production is deducted—does not actually reflect the value of the surplus labor or the work that went beyond what was necessary to cover the cost of the workers’ wages. Marx sarcastically deems this ability of capitalists to fix a price on something without really taking into account a worker’s labor a “miracle” (331), exemplifying, for Marx, the hidden exploitation at the heart of the capitalist system.