Labor-power

Introduction

As described by Karl Marx in Vol 1, Chapter 6 of Capital:

"By labor-power or capacity for labor is to be understood the aggregate of those mental and physical capabilities existing in a human being, which he exercises whenever he produces a use-value of any description. "

Or in simpler terms, labor-power is the capacity to do work. Capitalists pay wages to workers in exchange for their capacity to work.

Notably, Marx & Engels revised the Communist Manifesto to use the term 'selling of labor-power' instead of the 'selling of labor'. Labor-power is unique among all commodities as it is the only one capable of creating value. All other commodities remain fixed to their values.

It is common on Prolewiki to see the word labor-power used instead of simply 'labor'. Why is this? As previously mentioned above, when Marx and Engels wrote the communist manifesto in the 1840s, they also used similar terms of 'selling labor'. Some of the terms they used included "value of labour," "price of labour," "sale of labour" and so on. During this time Marx and Engels had not yet worked out the labor theory of value. This led to one of the only changes made to the communist manifesto when it was later republish by Engels. A change which was also made by Engels in the republishing of Wage labor and capital.

Reasons for Use of the Word and Its Unique Property

Engels describes why the change was made and why only labor-power can generate value:

"My alterations centre about one point. According to the original reading, the worker sells his labour for wages, which he receives from the capitalist; according to the present text, he sells his labour-power. And for this change, I must render an explanation: to the workers, in order that they may understand that we are not quibbling or word-juggling, but are dealing here with one of the most important points in the whole range of political economy; to the bourgeois, in order that they may convince themselves how greatly the uneducated workers, who can be easily made to grasp the most difficult economic analyses, excel our supercilious “cultured" folk, for whom such ticklish problems remain insoluble their whole life long.

Classical political economy borrowed from the industrial practice the current notion of the manufacturer, that he buys and pays for the labour of his employees. This conception had been quite serviceable for the business purposes of the manufacturer, his bookkeeping and price calculation. But naively carried over into political economy, it there produced truly wonderful errors and confusions.

Political economy finds it an established fact that the prices of all commodities, among them the price of the commodity which it calls “labour,” continually change; that they rise and fall in consequence of the most diverse circumstances, which often have no connection whatsoever with the production of the commodities themselves, so that prices appear to be determined, as a rule, by pure chance. As soon, therefore, as political economy stepped forth as a science, it was one of its first tasks to search for the law that hid itself behind this chance, which apparently determined the prices of commodities, and which in reality controlled this very chance. Among the prices of commodities, fluctuating and oscillating, now upward, now downward, the fixed central point was searched for around which these fluctuations and oscillations were taking place. In short, starting from the price of commodities, political economy sought for the value of commodities as the regulating law, by means of which all price fluctuations could be explained, and to which they could all be reduced in the last resort.

And so, classical political economy found that the value of a commodity was determined by the labour incorporated in it and requisite to its production. With this explanation, it was satisfied. And we, too, may, for the present, stop at this point. But, to avoid misconceptions, I will remind the reader that today this explanation has become wholly inadequate. Marx was the first to investigate thoroughly into the value-forming quality of labour and to discover that not all labour which is apparently, or even really, necessary to the production of a commodity, imparts under all circumstances to this commodity a magnitude of value corresponding to the quantity of labour used up. If, therefore, we say today in short, with economists like Ricardo, that the value of a commodity is determined by the labour necessary to its production, we always imply the reservations and restrictions made by Marx. Thus much for our present purpose; further information can be found in Marx’s Critique of Political Economy, which appeared in 1859, and in the first volume of Capital.

But, as soon as the economists applied this determination of value by labour to the commodity “labour", they fell from one contradiction into another. How is the value of “labour” determined? By the necessary labour embodied in it. But how much labour is embodied in the labour of a labourer of a day a week, a month, a year. If labour is the measure of all values, we can express the “value of labour” only in labour. But we know absolutely nothing about the value of an hour’s labour, if all that we know about it is that it is equal to one hour’s labour. So, thereby, we have not advanced one hair’s breadth nearer our goal; we are constantly turning about in a circle.

Classical economics, therefore, essayed another turn. It said: the value of a commodity is equal to its cost of production. But, what is the cost of production of “labour"? In order to answer this question, the economists are forced to strain logic just a little. Instead of investigating the cost of production of labour itself, which, unfortunately, cannot be ascertained, they now investigate the cost of production of the labourer. And this latter can be ascertained. It changes according to time and circumstances, but for a given condition of society, in a given locality, and in a given branch of production, it, too, is given, at least within quite narrow limits. We live today under the regime of capitalist production, under which a large and steadily growing class of the population can live only on the condition that it works for the owners of the means of production—tools, machines, raw materials, and means of subsistence—in return for wages. On the basis of this mode of production, the labourer’s cost of production consists of the sum of the means of subsistence (or their price in money) which on the average are requisite to enable him to work, to maintain in him this capacity for work, and to replace him at his departure, by reason of age, sickness, or death, with another labourer—that is to say, to propagate the working class in required numbers.

Let us assume that the money price of these means of subsistence averages 3 shillings a day. Our labourer gets, therefore, a daily wage of 3 shillings from his employer. For this, the capitalist lets him work, say, 12 hours a day. Our capitalist, moreover, calculates somewhat in the following fashion: Let us assume that our labourer (a machinist) has to make a part of a machine which he finishes in one day. The raw material (iron and brass in the necessary prepared form) costs 20 shillings. The consumption of coal by the steam-engine, the wear-and-tear of this engine itself, of the turning-lathe, and of the other tools with which our labourer works, represent, for one day and one labourer, a value of 1 shilling. The wages for one day are, according to our assumption, 3 shillings. This makes a total of 24 shillings for our piece of a machine.

But, the capitalist calculates that, on an average, he will receive for it a price of 27 shillings from his customers, or 3 shillings over and above his outlay.

Whence do they 3 shillings pocketed by the capitalist come? According to the assertion of classical political economy, commodities are in the long run sold at their values, that is, they are sold at prices which correspond to the necessary quantities of labour contained in them. The average price of our part of a machine—27 shillings—would therefore equal its value, i.e., equal the amount of labour embodied in it. But, of these 27 shillings, 21 shillings were values were values already existing before the machinist began to work; 20 shillings were contained in the raw material, 1 shilling in the fuel consumed during the work and in the machines and tools used in the process and reduced in their efficiency to the value of this amount. There remains 6 shillings, which have been added to the value of the raw material. But, according to the supposition of our economists, themselves, these 6 shillings can arise only from the labour added to the raw material by the labourer. His 12 hours’ labour has created, according to this, a new value of 6 shillings. Therefore, the value of his 12 hours’ labour would be equivalent to 6 shillings. So we have at last discovered what the “value of labour” is.

“Hold on there!” cries our machinist. “Six shillings? But I have received only 3 shillings! My capitalist swears high and day that the value of my 12 hours’ labour is no more than 3 shillings, and if I were to demand 6, he’d laugh at me. What kind of a story is that?"

If before this we got with our value of labour into a vicious circle, we now surely have driven straight into an insoluble contradiction. We searched for the value of labour, and we found more than we can use. For the labourer, the value of the 12 hours’ labour is 3 shillings; for the capitalist, it is 6 shillings, of which he pays the workingman 3 shillings as wages, and pockets the remaining 3 shilling himself. According to this, labour has not one but two values, and, moreover, two very different values!

As soon as we reduce the values, now expressed in money, to labour-time, the contradiction becomes even more absurd. By the 12 hours’ labour, a new value of 6 shillings is created. Therefore, in 6 hours, the new value created equals 3 shillings—the amount which the labourer receives for 12 hours’ labour. For 12 hours’ labour, the workingman receives, as an equivalent, the product of 6 hours’ labour. We are, thus, forced to one of two conclusions: either labour has two values, one of which is twice as large as the other, or 12 equals 6! In both cases, we get pure absurdities. Turn and twist as we may, we will not get out of this contradiction as long as we speak of the buying and selling of “labour” and of the “value of labour.” And just so it happened to the political economists. The last offshoot of classical political economy—the Ricardian school—was largely wrecked on the insolubility of this contradiction. Classical political economy had run itself into a blind alley. The man who discovered the way out of this blind alley was Karl Marx.

What the economists had considered as the cost of production of “labour” was really the cost of production, not of “labour,” but of the living labourer himself. And what this labourer sold to the capitalist was not his labour.

“So soon as his labour really begins,” says Marx, “it ceases to belong to him, and therefore can no longer be sold by him.”

At the most, he could sell his future labour—i.e., assume the obligation of executing a certain piece of work in a certain time. But, in this way, he does not sell labour (which would first have to be performed), but not for a stipulated payment he places his labour-power at the disposal of the capitalist for a certain time (in case of time-wages), or for the performance of a certain task (in case of piece-wages). He hires out or sells his labour-power. But this labour-power has grown up with his person and is inseparable from it. Its cost of production, therefore, coincides with his own cost of production; what the economist called the cost of production of labour is really the cost of production of the labourer, and therewith of his labour-power. And, thus, we can also go back from the cost of production of labour-power to the value of labour-power, and determine the quantity of social labour that is required for the production of a labour-power of a given quantity, as Marx has done in the chapter on “The Buying and Selling of labour Power.”

Now what takes place after the worker has sold his labour-power, i.e., after he has placed his labour-power at the disposal of the capitalist for stipulated-wages—whether time-wages or piece-wages? The capitalist takes the labourer into his workshop or factory, where all the articles required for the work can be found—raw materials, auxiliary materials (coal, dyestuffs, etc.), tools, and machines. Here, the worker begins to work. His daily wages are, as above, 3 shillings, and it makes no difference whether he earns them as day-wages or piece-wages. We again assume that in 12 hours the worker adds by his labour a new value of 6 shillings to the value of the raw materials consumed, which new value the capitalist realizes by the sale of the finished piece of work. Out of this new value, he pays the worker his 3 shillings, and the remaining 3 shillings he keeps for himself. If, now, the labourer creates in 12 hours a value of 6 shillings, in 6 hours he creates a value of 3 shillings. Consequently, after working 6 hours for the capitalist, the labourer has returned to him the equivalent of the 3 shillings received as wages. After 6 hours’ work, both are quits, neither one owing a penny to the other.

“Hold on there!” now cries out the capitalist. “I have hired the labourer for a whole day, for 12 hours. But 6 hours are only half-a-day. So work along lively there until the other 6 hours are at an end—only then will we be even.” And, in fact, the labourer has to submit to the conditions of the contract upon which he entered of “his own free will", and according to which he bound himself to work 12 whole hours for a product of labour which cost only 6 hours’ labour.

Similarly with piece-wages. Let us suppose that in 12 hours our worker makes 12 commodities. Each of these costs a shilling in raw materials and wear-and-tear, and is sold for 2.5 shillings. On our former assumption, the capitalist gives the labourer .25 of a shilling for each piece, which makes a total of 3 shillings for 12 pieces. To earn this, the worker requires 12 hours. The capitalist receives 30 shillings for the 12 pieces; deducting 24 shillings for raw materials and wear-and-tear, there remains 6 shillings, of which he pays 3 shillings in wages and pockets the remaining 3. Just as before! Here, also, the worker labours 6 hours for himself—i.e., to replace his wages (half-an-hour in each of the 12 hours), and 6 hours for the capitalist.

The rock upon which the best economists were stranded, as long as they started out from the value of labour, vanishes as soon as we make our starting-point the value of labour-power. Labour-power is, in our present-day capitalist society, a commodity like every other commodity, but yet a very peculiar commodity. It has, namely, the peculiarity of being a value-creating force, the source of value, and, moreover, when properly treated, the source of more value than it possesses itself. In the present state of production, human labour-power not only produces in a day a greater value than it itself possesses and costs; but with each new scientific discovery, with each new technical invention, there also rises the surplus of its daily production over its daily cost, while as a consequence there diminishes that part of the working-day in which the labourer produces the equivalent of his day’s wages, and, on the other hand, lengthens that part of the working-day in which he must present labour gratis to the capitalist.

" -Wage labor and capital, Introduction by Engels