HAS NEO-LIBERALISM BENEFITED CAPITALISM?
January 12, 2017 2 Comments
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January 12, 2017 2 Comments
THEPLANNINGMOTIVE.COM 
Could you explain this sentence further:
“Not only this, but because McDonald does not pay its workers for all their labour, they receive back more money than they pay out.”
Also, is it M.C…P…C+.M+, or is it M.C…P…M+.C+? The text makes it seem like C+, cash, is the outcome of the process.
Thanks.
Thank you for pointing out the error in the first paragraph of page 2 where I used C to describe money and M to describe the commodity in one line. Let me use this reply to correct it. The correct formulation is M.C….P…C.M where C stands for commodity and M for money.
To answer your question, Marx had to explain where surplus money and therefore profit came from. Before and after him the common explanation is that profit results from overpayment, or what is the same thing unequal exchange because the buyer pays for the commodity at a price above its value. Marx had to show that profits emerged without their being unequal exchange, something that Smith and Ricardo could not explain. What Marx showed was that workers do not sell their labour but their labour power and that labour power like any other commodity has a value, that is the cost of reproducing the worker fit for work. What is unique about labour power is its capacity to produce more labour than the labour needed to reproduce it. In simple language the working day is divided into two: the paid part and the unpaid part. During the paid part workers produce the value needed to reimburse the capitalist employer for their wage and in the second part they produce value which unpaid forms the profit of their employer. In the case of unproductive workers the working day is still divided into two. The first part is paid out of tax but the worker does not reimburse his or her employer for the wage because their product is never sold. Assuming the wage corresponds to the value of labour power, this wage is a complete loss and is seen as loss because the employers are not reimbursed for the tax used up paying this wage. It also true that the tax that pays the wage of unproductive workers only covers necessary labour and not surplus labour. Because this surplus labour is never paid, it means the tax cost of providing this service is lower than would be the case if the labour of the worker was sold because surplus labour would now have to be paid for which means a price higher than the tax used to pay for the service before. So while individual capitalists would benefit from turning this service into a commodity, wages would have to go up in general so that workers could afford these services which are now priced, instead of being paid out of tax.