Indirectly Social Labor

Indirectly Social Labor

(This is a draft chapter. Comments appreciated.)

This chapter considers Marx’s distinction between directly social and indirectly social labor. Indirectly social labor is a key concept used by Marx to characterize the distinctive nature of capitalism. Any attempt to theorize a way to break with capitalist production, to form a new society not organized around capitalist social relations, must have a plan to break with the indirectly social nature of capitalist production.

Since these are two types of social labor perhaps the first place to begin is to clarify what ‘social labor’ is in the first place. It is obvious to anyone that any labor process which requires more than one person (moving a piano, for example) is an inherently social activity since it requires the direct cooperation of individuals to achieve a task. This cooperation also entails mutual dependence of all laborers involved. (If one person drops the piano then everyone is screwed.)

But not all tasks require direct cooperation between people to be executed. A piano tuner, for instance, works alone. Her work does not require the direct cooperation of other workers and she is not mutually dependent on anyone else in order to tune a piano. However Marx argues that the piano tuner’s work is still social labor. Why?

But also when I am active scientifically, etc. – an activity which I can seldom perform in direct community with others – then my activity is social, because I perform it as a man. Not only is the material of my activity given to me as a social product (as is even the language in which the thinker is active): my own existence is social activity, and therefore that which I make of myself, I make of myself for society and with the consciousness of myself as a social being.”1

So even though our piano tuner works alone her labor is social because it is part of a much larger social organization of labor extending beyond the piano to encompass all of society. The materials which she uses (wrench, tuning fork) and the material she works on (piano) are all products of other people’s labor. Furthermore, the language she uses (equal-tempered tuning) is a social creation, the product of centuries of development. And the art of piano-tuning itself is an art which has developed over time through the labor of thousands upon thousands of other tuners. Each piano that she tunes supports the labor of piano players and teachers in her city as well as the training of future pianists. To be a piano tuner is to be a part of this much larger development and organization of labor. Thus, her “own existence is a social activity,” and “that which she makes for herself she also makes for society.”

The social nature of labor is an ever-present theme in Marx’s work not just because all labor is social but because labor is the activity through which society is produced and reproduced each day. Societies do not fall from the sky nor do they develop out of the mind of God or humans. They are built and rebuilt each day through practical human activity. Social relations are reproduced everyday with this labor. Thus labor is the basic constitutive unit of society. Because this constitutive unit is an activity, society’s essence is constantly in motion, in the process of creating itself. This explains the ability of human society to change so drastically over the course of history, from living in caves to living in condos. The specific organization of this social labor defines the particular essence of any human society, from primitive communism, to feudalism, to capitalism. By understanding human activity as the constitutive unit of society Marx is able to identify the radical potential of human activity, labor’s potential to radically transform society into new forms.

Directly and Indirectly Social Labor

The distinctive thing about the organization of social labor in a capitalist society is that, in opposition to all previous forms of society, the private labor of individuals manifests its social character through the value relations between commodities. In capitalism the labor of individuals is private labor, the labor of atomized, separate individuals, which only reveals its social nature indirectly through the exchange relations between the products of labor, commodity values. This indirectly social labor is different than the directly social labor of prior societies in which the labor of individuals was not private labor separated by the mediation of value.

Take for instance the “patriarchal system of production”, as Marx calls it, where the family unit was the basic productive unit, each member of the family contributing different labors to the collective product of the family. Here the labor of each individual is not private and the product of that labor does not take the form of private property to be exchanged against the product of other family members’ products. The labors of the family members do not take the form of commodities with values and they do not require exchange to reveal their social nature. Instead the labor of each individual is already directly social: each person’s contribution to the family’s product is immediately part of the total product of the family, without having to pass through the mediation of money.

Personal vs. Objective Dependence

The direct social labor of pre-capitalist societies was organized through relations of personal dependence. Individuals were dependent on other members of the community in direct, subjective ways. Relations reflected the specific personal relations between individuals whether they be the relations between members of a family or between feudal classes. This made social custom, belief structures and religion quite crucial in regulating the relations between people. Capitalism, by reducing all interactions between producers to commodity relations, annihilates these ties of personal dependence as well as these customs and belief structures. This change liberated people from direct, personal dependence on one another, freeing humans from relations of direct servitude and other forms of coercion associated with pre-capitalist class society. However Marx cautions that this apparent freedom from relations of personal dependence is not as free as it at first seems. Capitalism replaces the “personal restriction of the individual by another” with “objective restriction of the individual by relations independent of him and sufficient unto themselves.” “These external relations are very far from being an abolition of ‘relations of dependence’; they are rather the dissolution of these relations into a general form….These objective dependency relations also appear, in antithesis to those of personal dependence (the objective dependency relation is nothing more than social relations which have become independent and now enter into opposition to the seemingly independent individuals; i.e. the reciprocal relations of production separated from and autonomous of individuals) in such a way that individuals are now ruled by abstractions, whereas earlier they depended on one another.”2

What does Marx mean when he says that relations of personal dependence are replaced by relations of general objective dependence? The change from personal dependence to general dependence is easy enough to to grasp. Capitalism with its global distribution of labor, complex chains of payments, etc links individuals into a vast, global organization of social labor, each person dependent on society in general but not dependent on any particular person. But why does Marx call this general dependence “objective” and how do these objective relations “enter into opposition to the seemingly independent individuals”?

The over-arching point which Marx is aiming at here is the fact that capitalism is not ruled by people, by subjects making choices, but instead by objective economic laws. These laws rule people rather than people ruling over the laws. “Individuals are subsumed under social production; social production exists outside them as their fate; but social production is not subsumed under individuals, manageable by them as their common wealth.”3 A capitalist economy is of course made up nothing more than individuals making choices. However the circumstances of these choices is not a choice. Choices are made within a pre-existing system of production which has its own laws of motion, laws that take on a character of objective independence from society. As long as the capitalist mode of production exists these laws act in the same way as a law of nature: they are inevitable, unbreakable and proceed free from the actions of humans. Because relations between producers are not direct, because they are mediated through the value relations between objects, these value relations take an independent form, an autonomous force that regulates production outside of the control of the producers. This is why Marx was highly critical of proposals to modify surface features of capitalism without doing away with the system of indirectly social labor that lay at the root of capitalist production. Individuals, groups and states cannot run capitalism. Capitalism runs people. This is an inescapable aspect of indirectly social labor.

But what accounts for this objective, law-like quality of a capitalist economy? Let us look more closely at what it means for social relations between producers to be mediated by value relations between commodities, for labor to be indirectly social. In order to have money to buy my means of subsistence I must produce a commodity and it must sell in the market for a price. The connection between my labor and the labor of the rest of society is contingent upon the sale of my commodity for money. This money does not just measure the value of my own personal labor. The value of the widget I create is not determined by myself alone. It is determined by the socially necessary labor time it takes to make a widget. If I take 2 hours to make a widget but the socially necessary labor time for widgets is 1 hour then my two hours of labor are only worth 1 hour to society. Not all of my labor is counted as social labor by society. Only the socially necessary part of my labor counts as social labor. This is why we say that our labors are only indirectly social in capitalism. Our labors are only social in this limited, contingent way. The fact that my two hours of labor only count as 1 social hour is not a decision made by people. It is a result imposed upon me by forces outside of any person’s control. Even though socially necessary labor time is a result of human actions its imposition upon people takes the form of an impersonal objective force.

While in the above example my 2 hours of labor only count as 1 hour of social labor, money always counts for its full value. This is one of the ‘peculiarities of the equivalent form’ as Marx calls it.4 While the labors of people are always indirectly social, money, the mediating link between these labors, is directly social because it always counts for exactly as much value as it represents. Money can be exchanged for, it can measure the value of, any commodity. Money is social value in the abstract, unattached to any particular use-value. Of course the social power of money comes from society, from labor, but this social power appears as a force independent of individuals, an alien power confronting individuals. Money, the direct incarnation of social wealth, the objective link between individuals, exists in the form of an object which can be owned and amassed by, as well as kept from, people. “The individual carries his social power, as well as his bond with society, in his pocket.”5

So in a system of indirectly social labor not only are private labors regulated by social forces (socially necessary labor time) which are outside of the control of society but money, the mediating link which stands between these labors, appears as an objective social power outside of the control of individuals as well. Whereas pre-capitalist societies were organized through the direct personal dependence of people on one another, in capitalism this dependence becomes a general objective dependence. We depend on money. Money serves as our link to the rest of society. Money confronts us as the executor of objective economic laws.


In the same way that we said that directly social labor is constituted of subjective relations of dependence we could also say that directly social labor is organized around the particular aspects of labor as opposed to capitalism which organizes the universal aspects of labor. Returning to our hypothetical patriarchal family production unit we see that my contribution to the family’s product is very much bound up in the particularities of my labor. My particular skills, speed, habits, mood, health, etc all are immediately relevant factors in what I contribute to the family. This is not the case in a capitalist society where my output is a tiny part of the total output of society. The value of the widgets I make in a capitalist factory do not depend on my particular skills, speed, habits, mood or health. Instead this value is a universal, social value established by the time it takes society in general to produce a widget, the socially necessary labor time of widgets. Rather than the particularities of my labor it is the universal aspect of my labor that counts as part of the total social output. If the socially necessary labor time to produce widgets is 1 hour per widget but I require two hours to make a widget my widgets are not worth anything extra just because I took a long time to make them. They are only worth the social average. The particular nature of my work does not count. What counts is the universal aspect of my work.

What is this universal aspect? “This abstraction, human labour in general, exists in the form of average labour which, in a given society, the average person can perform, productive expenditure of a certain amount of human muscles, nerves, brain, etc.”6

This universal aspect Marx calls “Abstract Labor” and it forms the topic of a separate chapter in this book. However it is appropriate to explore the topic here briefly. These ‘universal’ aspects of labor may exist for all labors in all types of society. They also may only be some among many other universal aspects of labor. However these specific universal aspects are the ones deemed important to capitalism, the aspects which capitalism develops to the extreme, at the expense of other aspects of labor. Capitalism requires that all private labors are only counted as social to the extent that they take part in the formation of social averages of productivity, productivity measured as output over time. If socially necessary labor time is 1 widget per hour my labor will only count as social labor to the extent that it can produce at that average. Thus what is universal, what is social about my labor, is not any particular feature of me or the way I work. What is universal is the ability of my muscles, nerves and brain to produce 1 widget per hour. Marx argues elsewhere that capitalism is production for production’s sake. This productive imperative is reflected in abstract labor in which it is only productivity in the abstract that is socially valued. All particularity is erased and replaced by the imperative to produce at the social average. Capitalism develops this abstract character of labor, its physical productivity, to the extreme in its drive to amass profit for the sake of amassing profit.

If we look at labors in their particularity we see that they are all quite different, some much more productive, more efficient than others. However if we look at labor from the perspective of the person at Wallmart in charge of buying product from suppliers, then we see that all particularities are irrelevant. It does not matter what country the product comes from, the conditions of the producers, the health and safety standards of the conditions of production, etc. All that matters is the unit cost of the product. From the perspective of Wallmart all of those particular labors are just manifestations of value in general. They are considered only in their universal aspect. How would Wallmart calculate the value of an individual’s contribution? Wallmart would merely take the total value of the product and divide it by the total hours worked to create it. Through this process of averaging all particularity is erased and human labor is considered only in its most abstract aspects. “Labour, thus measured by time, does not seem, indeed, to be the labour of different persons, but on the contrary the different working individuals seem to be mere organs of this labour.”7

When does labor ‘become social’? (hint: trick question)

We have said that labor in a capitalist society is indirectly social because the labor of private producers only realizes its social character in the value relations between producers rather than the producers directly relating to each other. This seems straight-forward enough. However this concept has produced different interpretations. Isaak Rubin’s highly influential reading takes Marx to mean that the private labor of individuals does not become social until the products of labor are exchanged on the market. This then means that the labor itself, when it is happening, is not social (or only social in some ideal sense). The exchange process is what makes the labor social. For Rubin, it is market exchange which is the distinctive aspect of capitalism, the aspect that establishes the social relation between private producers.8

It is easy to see why such a reading would be tempting. The labor of separated, isolated producers does not appear to be social at first glance. The exchange process brings the products of those labors into relations with each other, establishing their social connectivity, and so it would seem that it is exchange which ‘makes labor social’ post festum. However Marx does not actually characterize the situation in this way. He speaks of exchange ‘realizing’ the social character of production. ‘Realizing’ the social character is different than ‘making’ the social character. If I ‘realize’ that the sun is out today this does not mean that I have caused the sun to come out today. If the exchange of commodities ‘realizes’ the social character of capitalist labor this does not mean that the exchange has caused one’s private labor to become<br / social labor. Furthermore, as we saw with our example of the piano tuner above, her labor was already social labor even though it was private labor. It was social labor because it was part of the total past and present labor of society. Even though her work is done in isolation, it is still a component part of a much larger social process of production. Exchange may realize these social connections, it may reveal the linkages between labors, and this labor may be production for exchange, but this does not mean that labor is not already social during production. In fact, her labor is always social because it is the labor of an individual in a society.

This distinction may sound like academics splitting hairs however there is more at stake here than first meets the eye. Rubin’s characterization of the matter suggests an understanding of capitalism in which it is market exchange that defines the essence of capitalism. Rubin often counterposes market exchange to the socialized production of communism in which planners replace the market with a plan. This seems to make sense of the directly-indirectly social labor distinction: markets are indirectly social; planning is directly social. This market-plan dichotomy is the hallmark of many Marxist and bourgeois characterizations of the difference between capitalism and communism. The fact that Marxists and their bourgeois critics accept the same characterization of communism and capitalism, plan vs. market, should be a clue that too much has already been conceded to the bourgeois vantage point.

But if we interpret the market to be merely ‘realizing’ the indirectly social nature of capitalist production then it is not necessarily the case that replacing the market with a plan will eliminate the indirectly social nature of production. If production is indirectly social then it could be realized by a market or a plan. If we take into consideration the above discussion of Marx’s critique of those who want to fix capitalism by managing it better without ridding it of value production, we might ask how planning alone can alter the indirectly social nature of value production. After all, do highly-planned production chains in capitalism have a more directly social character? Does the planned production of state industries have a directly social character? If the answer is ‘yes’ then planned capitalism might the road to communism!

In contrast to the ‘circulationist’ reading of Rubin there has been a development of Marx’s idea of indirectly social labor within the Marxist-Humanist tradition developed by Raya Dunayevskaya.9 This reading links the category of indirectly social labor to socially necessary labor time, a link we have already discussed above. Since SNLT is established in production and then realized/enforced in the market, this then implies that the indirectly social character of labor is present during production, to be realized later in exchange. Capitalist labor is not un-social in production, becoming social after the fact in exchange. Rather exchange realizes the indirect sociality of capitalist production (just as the labor of our piano tuner, above, is already stamped with a social form before the labor is even finished.) The essence of this indirectness is the fact, discussed above, that an individual’s labor is only social through a process of averaging which eliminates the particularity of labor, counting only the most abstract qualities of labor as social. Because only socially necessary labor is social, individuals do not relate their labors to one another in a direct sense. Their labors are only social in an indirect sense, mediated through this process of averaging.

The distinction between this humanist reading and the circulationist reading still may seem trivial. After all, SNLT only exists because we produce for exchange. Exchange plays a vital role in the process of regulating labor in a capitalist economy where private labors happen in relative isolation from each other. However the distinction becomes more crucial once we consider the nature of labor in the state-planned economies of the USSR. Soviet economists claimed to operate under the law of value, to produce commodities, similarly to capitalism. However they also claimed that they were doing so consciously, using the law of value to their advantage, as a conscious tool of state planning. This meant, according to Soviet economists, that while other categories of capitalist production may have been at play, labor was directly social. It was directly social because it was planned by people, not blind economic forces. This was meant to prove the socialist nature of their state-planning.10

But if we understand indirectly social labor to be the result of socially necessary labor time then it does not matter whether this labor’s social nature is realized by a market or by a plan. What gives it its indirectly social nature is the fact that one hour of my work is not worth as much as another’s. Labors are not treated equally. Instead a process of social averaging takes place which rewards some labors and punishes others. The mechanism which realizes or reinforces this does not alter matters. This argument has been used to argue that the USSR was actually a state-capitalist society, not a communist society. Such a claim requires an empirical analysis of the organization of the USSR, something outside the topic of this book. [cite mh and ticktin] What is important for our purposes here is to show the relevance and importance of the category of indirectly social labor. It is clearly a central concept to grapple with if we are to know how not to repeat the mistakes of the USSR as well as know how to build a real communist society in the future.

Directly Social Labor and Communism

Marx lays out, briefly, a way to make labor directly social, breaking with capitalist value production, in his Critique of the Gotha program. In Marx’s concept of directly social labor he advocates a system which breaks with the disciplining of production by socially necessary labor time. Producers in this post-capitalist society will not be compensated according to the social average but instead compensated directly for the actual amount of labor time they expend in production. If I spend 2 hours making a widget I get a labor-certificate entitling me to purchase consumption goods equal to two hours of labor. If you spend 3 hours making the same widget you get a certificate entitling you to 3 hours of consumption goods. Regardless of productivity our labors are directly social because they are compensated in full, considered part of the total labor of society, no matter what.11

Careful readers may ask how such a society would determine the labor-content of consumption goods (the ‘prices’ at which workers ‘buy’ them with their labor-certificates) in the absence of socially necessary labor time. This calculation would be based on the average social labor-time that it took to make a commodity. The calculation could be done simply by adding up all of the concrete labor times that go into making widgets and dividing this by the number of widgets. Such a calculation would allow society to continue to make production plans and to ‘price’ commodities. But the compensation of laborers would not be done through such a process of averaging. So such a system would not eliminate the role of average labor time as an accounting unit. What it would eliminate is the role of average time in the compensation of workers.12

Earlier we used a similar example of a Wallmart executive finding the average cost of of producing a commodity to set the price of the commodity. This example demonstrated how this process of averaging, which determines the socially necessary labor time, erases all particularity of workers, treating individuals only as units of average labor time, as abstract labor. Here, in our example of a communist society with directly social labor, we also see an example of the ‘prices’ of goods being calculated through a similar calculation of average labor time. What is the difference between these two examples? The difference is that Wallmart pays the same price for all of the commodities it buys from suppliers and those suppliers in turn only pay workers to the extent that they can produce at the social average. Any wasted time is not compensated. This creates an incentive for speed-up, exploitation, and the domination of machines over humans in production. In our communist society workers are compensated for the actual amount of time they labor, not just the part that achieves the average. This means that their labor is directly social. The immediate practical implications of this are that there is not an incentive for speed-up and so machines do not loom over production demanding more and more life from the worker.

To execute such an organization of labor it would be necessary for production to be owned and planned by society and not by individual capitals competing in the market. A society of directly social labor would entail different property relations and a different organization of production. In such a system labor-certificates would not circulate independently as money nor would alternative monies emerge spontaneously. This elimination of money would not be the result of political fiat. It would be a result of the organization of the mode of production. Directly social labor has no need for money. Money does not have a role in measuring socially necessary labor time. There is no need for a money commodity to measure the abstract labor content of commodities. The products of labor do not function as commodities with values. Without money and commodities there is no capital.


We saw earlier that capitalism’s system of indirectly social labor requires a process of social averaging in which individual labors are measured against a social average, measured in money. This money becomes an independent, objective economic force and society becomes ruled by impersonal, abstract forces. In contrast to the personal dependence relations of directly social labor in pre-capitalist society, capitalism gives us a general objective dependence on society. Marx’s labor-certificate proposal evolves directly out of this analysis of capitalism. In order to rid ourselves of this domination by objects and objective laws we must eliminate money and production for money. By rewarding all labors equally a communist society would eliminate the primary function of money, its role as a post-festum measure of socially necessary labor time.

We also saw how capitalism ignores the rich diversity of human labor and instead only counts as social the most universal and mechanical aspects of labor, the ability of human muscles and nerves to generate a certain average output over a span of time. Marx’s proposal would have the opposite effect. By counting all labor as social, with no exceptions, this eliminates the factory clock as the slave-master of the laborer. The drive to increase production at all costs ceases. Instead human labor is valued in its own right. Society can begin to develop the full-spectrum of human potentialities rather than the narrow spectrum of abstract labor.


1. Economic and Philosophic Manuscripts of 1844 from the essay “Private Property and Communism” p. 44
2Marx. Grundrisse p. 164
3Marx,Grundrisse p. 158
4Marx, Capital vol. 1 p. 151
5Marx, Grundrisse p. 157
6Marx.Contribution to a Critique of Political Economy p. 8
7Marx, Contribution to a Critique of Political Econ. p. 25
8In his essay Abstract Labor and Value in Marx’s System, which appeared in the Soviet journal Under the Banner of Marxism in 1927, Rubin answers critics who charge him with claiming that value is created in exchange (and that therefore labor is made abstract in exchange and labor becomes social in exchange). Rubin defends himself by saying that there are two senses in which we talk about exchange. One is exchange as a form of social reproduction in general and the second is exchange as a moment within the process of reproduction. Although exchange itself is only a moment within a larger process of reproducing capitalist relations Rubin argues that the entire process is characterized by exchange, that it is the fact that products are exchanged which accounts for the unique aspect of capitalist production. This allows him to try to pacify his critics by saying that labor is ideally abstract, ideally social at the time of production but only becomes abstract and social when commodities are exchanged. I find this solution problematic. Marx talks about ‘ideal price’ being realized in exchange but does not talk about ‘ideal value’ being realized in exchange. Rather Marx argues very explicitly that commodities and money enter the market already with values, therefore already representing a sum of abstract labor. If value already exists prior to exchange then the labor that makes this value must already have a social character prior to exchange.
9For the relation of indirectly social labor to socially necessary labor time see Kliman, Hudis and Weiss cited in Bibliography.
10Kliman, “A new look at the Russian Revision of Marx’s concept of ‘directly social labor’.”
11Saying that labor is compensated “in full” is slightly misleading. As Marx points out in the Critique of the Gotha Program, society would most likely choose to make certain deductions from compensation for a common fund that would fund the consumption of those who cannot work, allow for the construction of public goods, etc. See Gotha Critique p. 528-529
12Why is ‘price’ in quotes here? Ideally there would be a completely different term to designate this concept without needing to refer to the categories and terms of capitalist society. While indirectly social labor must be expressed in money prices (always averages expressed in the body of the money commodity), directly social labor could be expressed directly in labor hours. Stamping the products created by a communist society with their labor times would allow people to spend their labor certificates on a given amount of goods. However these labor times would not function in the way capitalist prices do. For one, labor certificates would not circulate as money because there would be no value production and thus no need for a general equivalent. Because goods would not be produced for exchange they would not have exchange values or intrinsic value and thus would not need to externalize their value in the form of the equivalent, money. See Pannekoek quote in David Adams piece cited in Bibliography
Hudis, Peter. “Directly and Indirectly Social Labor: What Kind of Human Relations Can Transcend Capitalism?”
Kliman, Andrew “A new look at the Russian revision of Marx’s Concept of ‘directly social labor’”, News and Letters; Nov.-Dec. 2005.
Marx. “Capital” Penguin edition
Marx. “Critique of the Gotha Program” in “Marx-Engels Reader” ed. Tucker
Marx. “Contribution to a Critique of Political Economy”. Marxist Internet Archive
Marx. “Grundrisse” Penguin edition
Marx. “Economic and Philosophic Manuscripts of 1844” Marxist Internet Archive translation
Rubin, II. Abstract Labor and Value in Marx’s System, in “Under the Banner of Marxism” 1927.

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10 Responses to Indirectly Social Labor

  1. Noa Rodman says:

    I think a common oversight is that Marx says that in capitalism exactly the labor involved in the production of the general equivalent is ‘directly social’. So in case gold is the general equivalent, the labor required to produce gold is directly social. Cyril Smith (on MIA), in disbelief, even claimed this point by Marx to be a translation error! But Marx is very clear; “although, like all other commodity-producing labour, it is the labour of private individuals, yet, at the same time, it ranks as labour directly social in its character. This is the reason why it results in a product directly exchangeable with other commodities. We have then a third peculiarity of the equivalent form, namely, that the labour of private individuals takes the form of its opposite, labour directly social in its form.”

    In the earlier edition he also remarked:
    “The standard of ‘socialness’ must be borrowed from the nature of those relationships which are proper to each mode of production, and not from conceptions which are foreign to it.”

  2. Old says:

    There was a Mutualist (Josiah Warren) who experimented with something similar to Marx’s idea of labor-notes. The Cincinnati Time Store, which worked from 1827 to 1830 was a store where every good was priced according to how many hours on average it took to make it (12 pounds of corn were the “standard” for 1 hour) and people paid each other in “labor notes” which were promises to do labor. Certain prices were adjusted for work that was significantly harder or very unpleasant but on the whole one hour of someone’s labor was worth 1 hour of anyone else’s labor, so labor was generally compensated in full.

    The store was surprisingly a success, Warren was doing more trade in 1 hour than every other shop around was in a whole day, a neighboring shop adopted his methods, and Warren in 1830 moved in with an intentional community that was planning to build a utopian Phalanstery.

    This makes me wonder: If we have a “market” socialism where each factory and shop is controlled by it’s workers, there is no interest or rent, and most importantly goods and labor are paid in full and not following the SNLT; does this break with the law of value and abstract labor despite still having a “market”?

    • Good question. The short answer: NO!

      Marx was completely opposed to these sort of mutualist labor-money schemes. He wrote 100s of pages of invective against Proudhon, Darimon and others, in many books, critiquing these concepts. You might even argue that a central inspiration for his economic writing was the need to critique these bourgeois socialist theories.

      A fairly readable and short essay on the difference here:

      Here’s my appalling brief summary of the difference:

      Proudhon wanted to maintain private production. He thought that exploitation, crisis and other social ills came from unequal exchange. Marx showed that actually exploitation and crisis would occur even if all commodities sold at their values. So Marx’s goal wasn’t to make market exchange more fair. He wasn’t into ‘fair trade’.

      He makes several very practical critiques of why Proudhon’s labor money wouldn’t work: a capitalist economy requires a process of social averaging, socially necessary labor time, which makes all commodities exchangeable at the same price. This requires the existence of money. Money must exist separately from commodities in a system of private production. If you try to replace money with time-chits time-chits will just start acting like money again or some other commodity will. (Marx’s treats money as, originally, a commodity almost expressly to critique Proudhon’s assumption that we can treat money as something to be legislated. Money is a direct product of commodity exchange and no enlightened state can make it go away.) Marx discusses the reality of time-chits’s value changing as productivity changes, etc. and all sorts of other technical problems.

      Then he suggests that really, not of this accounting of labor time could happen without socialized production in the first place. Proudhon’s assumptions is that labor can be immediately social by legislating it so. But it can’t be directly social unless production is social.

      • Old says:

        I think it’s a bit of an inaccurate oversimplification to say Proudhon believed the problem was just unequal exchange when in Chapter IV of What is Property? he directly states:
        “Property sells products to the laborer for more than it pays him for them;.” and “Increase [exploitation] receives different names according to the thing by which it is yielded: if by land, farm-rent; if by houses and furniture, rent; if by life-investments, revenue; if by money, interest; if by exchange, advantage gain, profit (three things which must not be confounded with the wages or legitimate price of labor).”; directly pointing to exploitation that happens in production and not because of prices deviating from values.

        I think Proudhon’s early assumption was that, if workers controlled the “full value” of their labor with out having any part of it taken by a capitalist or landlord, them production is directly social – even if workers organize themselves privately and compete with one another. And after the 1860’s Proudhon began to preach that workers should associate together into an “Agro-Industrial Federation” to co-ordinate exchange and production and share certain resources, so i think he may have changed his mind about “private production” over time – though the American Mutualists definitely defended private production well into the 20th century.

  3. Holy crap, this is so good! And really relevant to a lot of discussions among Marxists today! Ive been following Kap101 for a long time, how did I miss this?

  4. I’m wondering how the labor time spent on machinery and buildings would, if at all, fit into the “prices” or determination of the labor content of products made with the machinery and buildings, etc( I suppose support labor, like clerical work and transportation as well would fit in?). It seems obvious we cannot only count the labor-time of the final assembly of the product. I’ve been posed this question by skeptics of Marx.

    This seem like an epic math and statistical problem. Obviously this raises the “socialist calculation debate” issue and is separate from the issue of how Marx envisioned values abolition, which I agree with him on…

    But id be interested in your thoughts?

    • Yes this would be a separate question then the question of how to end value-relations. I think Marx’s comments about creating directly social labor are really a logical deduction of how to eliminate indirectly social labor. Your question is a specific concrete question about how to plan production and it seems to me that there are several ways it might be answered. The most obvious would be in the same way cost of fixed capital is applied to the prices of commodities in capitalist society: The average labor time embodied in machinery could be part of the labor-cost of the products of that machine spread out over the total amount of products created.

  5. ReadingCapital says:

    “We saw earlier that capitalism’s system of indirectly social labor requires a process of social averaging in which individual labors are measured against a social average, measured in money. ” Why does capitalism require a process of social averaging? I’ve been searching for this answer and it never explicitly says this anywhere.

    • ReadingCapital says:

      What happens if capitalism didn’t have this process of social averaging? Where did this come from?

    • that is what socially necessary labor time is: labor only counts to the extent to which it is average labor time. And this is because production is primarily undertaken for the purpose of producing value. does that answer the question?

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