The Real Movement

As I showed in the first part of this series, Marx’s argument is that the rate of profit falls because, over time, generally less labor is employed in the production of commodities. The falling rate of profit triggers a crisis during which capital attempts to restore the normal operation of the mode of production.

Among Marx’s findings: Even if an increased quantity of labor is generally employed throughout the ‘economy’, this increase in the total sum of labor is accompanied by a decrease in the labor embodied in each of the individual commodities produced. The result is that, over time, even if more value is created, it is embodied in even more use values, each of which requires less labor to be produced.

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For people who care about how the dollar works to slow capitalist collapse, Ernest Mandel wrote an interesting piece in 1968, The Crisis of the International Monetary System. I found the essay both interesting and puzzling.

Why I find the essay interesting is probably obvious to anyone who reads this blog regularly. I think Marx’s view of money and associated issues is far too blithely dismissed by even those who consider themselves orthodox followers of his theory. My argument is simple: you cannot claim labor theory is legitimate and valid while arguing one of the most fundamental and critical labor theory premises of commodity production and exchange — that money itself must also be a commodity — is invalid.

(Which is to say, of course, you can hold this position, and may even be right about it, but the results of your analysis won’t be consistent with labor theory. Something has to give here.)

Before I explain why I found Mandel’s essay not only interesting but, more importantly, puzzling, I want to provide some context.

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