#universal equivalent

1. Money is a social relation, appearing as metal, stone, etc. Gold/ silver as naturally occurring is not money. Nature doesn’t produce money, but money is directly gold/silver. In its third quality -- in its perfection -- the formal function of money as measure vanishes. But the fact that it is a result of a social process is not apparent. It is (just) money. And realizing money as social process is made more difficult by the fact that its use value serving the individual p. 239 is extinguished in being exchange value. And here all the contradictions of exchange value and of its corresponding social production emerge. Previously, we (Marx) criticized attempts to overcome these contradictions by depriving money of its metallic form and, instead, something posited by society and expressing a social relation in labor-money (time chit). This foolishness should be clear as exchange value remains the basis (of labor-money). As the opposition to the ruling relations of production are directed against money as it represents the most striking/ palpable contradictions, artful tinkering of money is supposed to overcome the contradictions of which money is only the appearance. As long as there is only an attack on money, the consequences; the causes of disturbances in the productive process remain unaffected. And those with power -- via means that are more or less violent -- can define these as passing disturbances.

2. To construct apologetics, money is presented in its simple form, disregarding it in its pure (third) form. In this way, the inherent contradictions of bourgeois society appear extinguished in the character of money. p. 240 To the extent commodities are just exchanged, individuals are just exchangers; this indicates the social function or relation between individuals. Each person is an exchanger and their relation is one of equality and the commodities they exchanged are equivalents -- barring error/ cheating. The pure form or economic side of this relation -- opposed to the content which falls outside economics as natural, but coinciding with it (use value) -- has three distinct moments: (1) exchangers; (2) objects of exchange/equivalents -- not only equivalents but supposed to be equal; (3) act of exchange: where exchangers are equals. The equivalents are the objectification of one subject for another are of equal worth but at the same time are mutually indifferent: i.e., subjects in exchange exist for one another through their equivalents of equal worth and thus exist for each other as equally worthy but also indifferent to each other, as whatever individual differences/peculiarities there are between them is not a concern. But now, re the content outside the act of exchange/ the economic form is (1) particularity of the commodity; (2) particular natural need of the exchangers/ use values of commodities exchanged. This content of exchange does not endanger the social equality of individuals but makes natural differences into their social equality. If individuals A and B both had the same needs and satisfied them in the same way, there would be no relation between them; considering production they would not be different individuals, like two people breathing the same air with no social contact. The difference between needs and production gives rise to exchange and the social equation where natural differences are the precondition of social equality in exchange. Re. the natural difference between them; A is owner of the use value for B and vice versa. Therefore, their natural difference puts them into a relation of equality. 

3. However, in this relation they are not indifferent to each other, but integrate with one another as B, objectified in the commodity is a need of A and vice versa and stand not only as equals p. 242 but in a social relation. Moreover, the fact that each is satisfied by and produces the needs of others proves that they relate to each other as human beings / their common species-being. This does not occur among animals. The natural differences among individuals and their commodities (albeit products & labor are not different here but exist as commodities) are the motive for integration and their social integration as exchangers, where they are stipulated and proved to be equals. But in addition to this equality there is the character of freedom. While A has a need for B’s commodity, A does not appropriate it by force and vice versa. Instead, A and B recognize each other reciprocally as proprietors; persons whose will penetrates their commodities. Thus, the juridical moment of the Person (sic) enters as well as freedom. No one seizes another’s property by force; property is divested voluntarily. So too, A serves B via commodity a, only in so far as B serves A via commodity b and vice versa. Each serves the other to serve themselves; each makes the other their means. Thus, in the consciousness of A & B: (1) Each arrives at their end by serving the other as means (2) each becomes p. 243 means for another only as an end for self (3) this reciprocity for each -- which is means and end for both -- and they attain their end only by becoming a means, and become a means only by positing themselves as end. Each thus posits themselves as a being for another in so far as they are being for themselves and the other is being for them. And, in so far as they are being for themselves, this reciprocity is a necessary fact, presupposed as a natural condition for exchange; but as such is irrelevant for each in exchange as this reciprocity interests the individual only as it satisfies their interest to the exclusion/ without reference to the other. The common interest, which appears as the motive, is not the motive but proceeds behind the back of self-reflected, particular interests: behind one’s interest opposed to another. Albeit, at most, the individual can have the consoling awareness that satisfaction of their (antithetical) individual interest is precisely the realization of the (suspended antithetical) general, social interest. Out of the act of exchange, individuals are reflected in themselves as it’s (exchanges) exclusive and dominant subject. And with that, the complete freedom of the individual is posited as a: voluntary transaction; with no force; positing or serving the self as means to posit self as an end in itself, as dominant/primary. And, finally, the self-seeking individual which brings nothing of a higher order to realization, recognizes the other as self-seeking, with the other also recognizes their self-seeking interest, so that both know their common interest exists only in the duality and autonomous development of exchanges between their self-seeking p. 244 interests. The general interest is precisely the generality of self-seeking interests. Therefore, when the economic form/ exchange, posits the equality of its subjects, then the content -- the individual as well as the objective material that drives toward exchange -- is freedom. Exchange of exchange values is thus the productive, real basis of all equality and freedom. As pure ideas, they are merely expressions of this basis and as judicial, political and social relations they are merely the basis to a higher power. This equality and freedom are exact opposites to equality and freedom in antiquity, where developed exchange value was not their basis, but the development of that basis (in antiquity) destroyed them (equality & freedom). Equality and freedom are presupposed in relations of production -- as yet unrealized -- in antiquity and Middle Ages. Direct forced labor is the foundation/ where community rests, in antiquity. And labor as a privilege -- still particularized -- not yet generally producing exchange value is the basis of the Middle Ages. Here, labor is not forced nor does it take place with respect to a common, higher unit.

4. Admittedly, re. natural motives outside the economic process does rest on a compulsion; on one side, the other’s indifference to my need/ natural individuality and hence their equality with me and their freedom, which is a precondition of my own; on the other side, if I am determined/ forced by needs and drives, it is only my own nature and is nothing alien to me: my interest posited in a general, reflected form. But it is precisely in thus way that I exercise compulsion over the other and them into the exchange system. Servus in Roman law is one who does not enter exchange to acquire anything for self. Therefore, this legal system corresponds to a social p. 245 state where exchange is not developed. Nevertheless, in so far as it was developed, it was able to develop the attributes of the juridical person, precisely the individual engaged in exchange; anticipating the legal relations of industrial society and the right bourgeois society had to assert against medieval society. But the development of this right coincides with the complete dissolution of the Roman community.

5. As money is only the realization of exchange and the system of exchange values only realized itself in developed money system, the money system can only be the realization of the system of freedom and equality. As measure, money only gives the equivalent its specific expression and makes it an equivalent form. But a distinction in form does arise in circulation: the two exchangers appear in different roles as buyer and seller. Exchange value appears once in its general form as money, then in its particular form in a commodity with a price. But these forms alternate. Circulation does not create a dis-equation but merely a suspension of the negated difference (?). The inequality is only formal. Even equality posits itself tangibly in money as medium of circulation. Each views the other as owner of money and views the process of exchange as money itself. Thus, indifference, and equal worthiness are expressed in the form of a thing. The particular, natural difference in commodities is constantly extinguished by circulation. A worker who buys a commodity for 3′s appears to the seller in the same function/ in the same equality as 3′s -- and the king does the same. All distinctions between them disappears. The seller only appears as an owner of a commodity with a price of 3′s, so that both appear equal -- except that 3′s exists as e.g., silver or sugar. Money in its third form might seem to enter between subjects in the process. But as money is the material/ general commodity of contracts, distinction between the contracting parties is extinguished. As money -- the general form of wealth -- becomes the object of accumulation, the subject p. 246 withdraws it only to the extent that they do not withdraw (purchase) commodities. Thus, if one accumulates and the other doesn’t, it is not at the expense of the other. If one gets poor and the other wealthy, it is because of their own free will and does not in any way derive from the economic relation; the economic connection as such where they are placed. Even inheritance -- which perpetuates this inequality -- does not prejudice this natural freedom and equality. If A’s relation is not in contradiction to the system originally, then such a contradiction (of inequality?) doesn’t arise because B steps into the place of A, and perpetuates A (?). Rather, this is the perpetuation of the social relation that is a person’s natural lifespan and is reinforcement against influences of nature that might suspend individual freedom. Moreover, as the individual in this relation is only the individuation of money, they are just as immortal as money, and representation by their heirs is merely a logical extension of this role.

6. If this (above) way of conceiving the matter is not put in historical context, but raised to refute the more developed economic relations where individuals no longer relate to each other as exchangers/ buyers & sellers, but in specific relations that are no longer of the same character, then it is the same as saying there is no difference between natural bodies because they have weight and therefore are equal. Similarly, exchange value is viewed in its simple character, as the antithesis of more developed, contradictory forms. Same in science: where abstract attributes appear earliest and sparsest and appear historically with the more developed as the more recent. In the present bourgeois society, the positing of prices and their circulation, etc. appears as the surface process, beneath which there is an entirely different process where individual equality and liberty disappear. It is forgotten that the presupposition of exchange value p. 247 as the basis of the system of production implies compulsion over the individual, as their product is not a product for them, but becomes such in the social process and must take this general, external form: that the individual only exists as a producer of exchange value and hence the negation of their natural existence is implied; therefore determined by society; and thus presupposes a division of labor, etc. where the individual is posited as more than a mere exchanger. This presupposition does not arise out of the individual’s will or nature but is historical and posits the individual as already determined by society. It is forgotten that these higher forms where exchange is realized -- or the relations of production which realizes themselves in it (exchange) -- do not stand still in the simple form and where the highest distinctions are merely formal and irrelevant. What is overlooked, is that the simple forms of exchange value and money latently contain the opposition between labor and capital. Therefore, what all the wisdom comes down to is to stick fast to the simplest economic relations -- which are pure abstractions -- but are mediated by the deepest antithesis, and represent only one side in which the full expression of the antithesis is obscured.

But unlike previous conditions where families and clans produced just enough to meet more basic needs and wants, “progress” in science and technology, always people to produce much more and, indeed, a surplus of needs and wants in a given period of time. However, this is also accompanied by a greater division of labor, where people rarely produce things from start to finish but contribute a portion to the final product, increasingly in factories and other workplaces outside of the home that produce one or a limited number of things. Therefore, few produce everything that is required to meet even basic needs in one place. It thus becomes necessary to exchange the surplus of what is produced to secure wants and needs from many different sources. So too, with a surplus of what is required to meet needs and wants, there is time to produce a greater variety of things. Marx argued that there is thus an expansion of needs and wants; and with improved means of transportation and communication, there is greater ability to exchange surplus products for products from around the world.

Marx then notes that only things that vary qualitatively are exchanged. For example, it would not make sense to exchange a pencil for a pencil of the exact kind. The question then becomes how qualitatively different things are exchanged. Marx noted Aristotle’s frustration when he attempted to explain how qualitatively different things were exchanged: such as five beds for a house in ancient Greece. Marx argued that in order to exchange two commodities with different qualities they must share something in common: a third thing that is qualitatively different from the two things. Moreover, as it would not always be possible to exchange one thing for another, such as exchanging one pencil for one watch, this substance must also vary in amount from one commodity to another. Clearly, if a number of pencils are exchanged for a watch it is not because these two things share a quantity of a particular chemical or other natural substance.

At least as far back as Aristotle, numerous philosophers and political economists, including Thomas Aquinas (1225-1274) and the North African social philosopher Ibn Khaldun (1332-1406), contended that the substance that facilitated exchange was labor. And, in particular, Marx focused on the work of Adam Smith (1723-1790) and David Ricardo (1772-1823), two of the most influential political economists of the late 18th and early 20th century who argued that what explains how things are exchanged is the human labor embodied or objectified in a product. Isaak Rubin and others argue that Marx did not view the value of things as something material or created by the physical activity of laboring. While physical activity related to specific sorts or qualities of labor is of course necessary to produce things according to Marx, it is not sufficient to create value. Marx called the physical activity of laboring concrete labor. Concrete labor creates tangible things that are useful and thus have what he and other political economists called use value. 

For example, the specific, qualitatively distinct activities of milling grain and baking are necessary to produce bread and use value that provides nourishment and taste. However, as Marx describes, the use value of something does not depend on the quantity of this useful, physical labor. As he notes, even if the concrete labor required to produce a loaf of bread decreased by 95% with improved techniques of production -- or it ‘fell from the sky’ -- its use value would still be the same. Consequently, the use value of a thing cannot explain variations in the proportion that is exchanged for other things. For example, the use value of a loaf of bread does not explain why it might exchange for a dozen apples at one point in time and a half dozen later on. Moreover, the concept of concrete labor does not explain how qualitatively different types of labor such as baking bread and picking apples are compared and exchanged. Thus, neither useful, concrete labor nor the use value of what it produces can explain the exchange of qualitatively different things produced by qualitatively different types of labor.

1. A commodity has a two-fold character: Use-value (i.e., something that satisfies a need) and Value (i.e., is the product of labor).

2. Therefore the 'commodity form' must have a 'form of use-value', which is its "tangible, sensible, existence and natural form" and a value form. The value form is a social form and is expressed and gains an 'appearance of its own' through its relation with 'different' commodities.

3. Marx begins with the most simple relation, between a commodity and a single, different commodity, which he calls the 'simple value form' or "Form I". Here, one commodity 'expresses its value' in the body of another commodity. The commodity that expresses its value is represented as relative value or the 'relative value form',and the commodity that serves as the material expression of value is its 'equivalent value form'.

4. However, in order for one commodity to be compared and be equal to another commodity, it must 'share something of its own kind' with the other commodity and contain the same substance/ essence. The two commodities are the same and share a substance/ essence as 'values', as they express forms of things produced by human labor power that represent the "jelly of abstract human labor" and 'qualities' in the denominator of the equation relating the two commodities. This "jelly" or "value substance" is also of a 'definite magnitude or quantity" and is the numerator in the equation.

5. While the 'bodily form' of the equivalent is not "abstract human labor" and remains a definite product of "concrete useful labor", "in the expression of value" it is the "form of appearance of abstract human labor". In this way, the concrete labor 'hides" in the equivalent. Similarly, the products of labor cannot become commodities if they are not products of private labor. But through a "naturally evolved social division of labor" these products satisfy socially generated wants via a material interconnection of private laborers that is mediated and therefore realized only through exchange of products. In this way, 'the production of private labor only has a social form insofar as it has a value-form and form of exchangeability'.

6. But in these definite social relations, where producers equate their different types of labor as human labor, this social property of their own labor appears to them as properties of the products themselves, by nature. This is the 'fetishism' that 'clings' to products and -- 'as commodities' -- is inseparable from commodity production. Therefore 'through this value form, the value of a commodity is expressed as something completely distinct from its own sensible existence.'

7. In the value relation, the natural form of one commodity counts only as the shape of use-value while the natural form of the commodity in which it expresses its value counts only as value-form or the shape (Gestalt) of exchange-value. But, for example, the first commodity is not only a use value but an exchange value in that it is equated with another commodity and is thus a 'unity' between use and exchange value. Therefore, the product of labor 'brings into the world' the form of a use-value. It then requires only the value-form to possess the 'commodity form' and to appear as a unity of the opposites of use-value and exchange value. In this way, the development of the value form is identical with the development of the commodity form. And, consequently, a commodity's expression of value in another commodity gives it 'value-form' and, by virtue of this, it distinguishes itself as simply value and use-value.

8. However, In this value-form (Form I), the commodity is placed in a qualitative and quantitative relation to all other commodities. Therefore, the commodity has as many simple expressions of value as there are other commodities. And thus the 'complete expression of its value" consists in an 'isolated simple relative expression of the value in the sum of all these simple relative expressions of value'. This is what Marx calls the "Expanded Value Form" or "Form II". Here, the commodity stands in a social relation not only to a single commodity but with the world of commodities. However, this expanded value form is problematic in a number of ways. For example, the relative value of the commodity is expressed in an endless series of expressions of value.

9. But if we reverse the commodity's relative value form and make it, alone, the equivalent form of value, the "General Value Form" (Form III) emerges. That is, all commodities can express their value in this single commodity that counts as their general shape of value. Every commodity is therefore distinguished as value from its existence as a useful object and, at the same time, relates as value to all other commodities as equal to it. In this value-form a commodity possesses general social form. And it is only through this general character that the 'value-form corresponds to the concept of value', i.e., as expressions in the form of things of the same labor substance. In this general value form commodities are both qualitatively equated and quantitatively represented.

10. The particular equivalent form is now further developed to the general equivalent form in Form III. In this equivalent form, its natural form is at the same time its social form and 'counts as the form of appearance of the embodiment of homogenous, undifferentiated human labor'. All other commodities possess the general relative value form and are excluded from being the equivalent form and immediately exchangeable. This exclusion is an objective, social, and historical development independent of the specific commodity that is the general equivalent. In Form IV, by "social custom" and the "progress" of the equivalent form, gold, "little by little" functions as the general equivalent, 'conquering the monopoly of this position in Form III and expressing the value of the world of commodities as the 'money commodity'.

11. While there is little difficulty understanding the transition from Form III to Form IV, a greater difficulty is understanding the transition from Form II to Form III. However, Form III "resolves itself" into Form II and the "constitutive elements" of Form II are in Form I. And, 'if we know what use-value and exchange-value are, then we find that Form I, is the simplest, most undeveloped manner of representing any product of labor as a unity of the opposites of use-value and exchange value'. Form here, we can easily understand the 'series of metamorphoses' from the simplest commodity form to the money form.