Hello comrades.
After looking at the commodities and value and law of value-mostly under socialism-let us now take a look at laws and categories in general so that we can come back to commodities and law of value under socialism.
We put things into different categories, thus separate them from one another. There were times when these categories were considered as solid, not changing at all. We now know that there is no such categories. Withing their solidness lays their change into another and indeed their dissolution.
Metals were put in a category of solids. But than not only did we find that mercury is a metal and yet liquid, we also found that all metals, giving the right temperature transform into liquids. From here we can come to our famous or infamous water. It is liquid. And yet at 100 degrees Celsius in transforms into gas (steam). It is a law of water’s transformation that water boils (transforms into gas from liquid) at 100 degrees Celsius. Just like all laws it is but a necessary relation in the relation of liquid water to heat. Laws are indeed nothing but the necessity, the necessary relations in relations of things with other things.
But take note: this relation is conditioned by the fact that there must be one atmosphere of pressure. Indeed go to the top of the Everest mountain where the pressure is less, you will find that water boils before the temperature reaches 100 degrees Celsius. Or ask our miner comrades in South Afrika to boil water in the depth of their gold mines where the pressure is more, you will find that water does not boil at 100 degrees Celsius, it needs higher temperature.
We can refer to such other conditioners as the purity of the water, which affects the boiling temperature of water too.
What happens when water boils and turns into gas (steam)? Well it expands. And one can use this transformation to create steam engines and use this expansion through steam engines to create all sorts of motions. One can than move machines in a factory using this or run a train or ship, even a tractor. And many others besides.
Thus having a good knowledge of transformation of water from liquid form to gas form and being able to apply it in production technology is a very useful thing indeed. Most of us would also know of the pressure cookers..
Please note that we boiled water for thousands of years and we have witnessed the power of steam for thousands of years but we did not come up with a steam engine until the beginnings of the industrial revolution. Scientific knowledge of natural forces, their laws of motion and based on that the application of this knowledge in the creation of technology has gained momentum with the industrial revolution. It is now at the verge of taken off at the speed of light-thanks to development of our knowledge, the creation of the computers, and the internet, thus for every person to contribute to the development of this knowledge and technology : the only thing that is retarding this is the political power of the financial oligarchs, the bourgeoisie-the present day barbarians!
What is valid for nature is valid for economics, for political economy! One science that the present day barbarians want to keep away form us, do not want us to learn its laws and apply them to overcome all our difficulties-that is their barbarity!
It is thus that they do not want the economic law of the obligatory correspondence of production relations to the nature of the productive forces to be known and applied in our social life. After all it would mean the end of their rule, and freedom of all, no restrain of the development of productive forces of our society and thus the abundance of products for all humans, no hunger and no war!
Let us now have a look at the category of commodities and value and law of value:
There was barter, exchange of products amongst primitive communist societies where all the means of production and thus the products were communally owned and thus there was no commodity production, but these societies bartered, exchanged their surplus products, and in time with the increase in the number of products, especially of products of handicraft, with the development of division of labour within the primitive communist societies, commodity production, production for exchange has risen. With this the private ownership of means of production and the end products have also arisen right within the primitive communist society. But most of the products were not commodities and their division amongst the members of the said society was not done through commodity circulation-trade.
The same goes for slave society and feudal society. And indeed it is with slave society and the coming into being of money that commodity production and thus commodity circulation-trade progress. But even than most of the products are still not produced and exchanged as commodities.
Please note that we have commodity production and commodity circulation-purchase and sale, trade but no capitalism.
It is only with coming into being of capitalism that commodity production and commodity circulation-purchase and sale, trade becomes universal.
Under capitalism we have the private ownership of the means of production; labour power itself appears in the market as a commodity which can be bought by the capitalist and exploited in the process of production, and the system of exploitation of wageworkers by capitalists exists.
It is otherwise under socialism:
the means of production are no longer private but socialist property, there is social ownership of the means of production; the system of wage labour no longer exists, it is abolished and labour power is no longer a commodity, the system of exploitation is abolished, eliminated.
Under socialism, the sphere of operation of commodity production is restricted and placed within definite bounds.
The law of value is a regulator of production and circulation of commodities under capitalism where the means of production are privately owned.
Value of a commodity comes into being in the sphere of production but law of value operates in the sphere of production through the sphere of circulation-purchase and sale, the market, and that through prices.
It determines the prices of commodities in the market which should reflect the average amount of profit, but it can determine this price in the market only in a spontaneous and vacillating fashion. The law of value through this price mechanism, and thus the profit made by each producer, which deviates from the average regulates the relations between the various branches of production, regulates the distribution of labour among them, regulates the “proportions” of labour distributed among the various branches of production.
Under capitalism Law of value operates with the law of competition and anarchy of production.
Sphere of operation of the law of value is very wide spread under capitalism and gives rise to the periodical crises of over-production.
The operation of the basic law of modern capitalism cannot overcome this and on the contrary only accentuates it.
Under socialism where the means of production are socialised, the law of value operates in commodity circulation-exchange, where it functions-withing certain limits- as a regulator and also in production, where it has no regulating function but influences it. Consumer goods are produced as commodities, and this is where law of value influences socialist production.
Because the prices are fixed in a planned manner, because they are not determined spontaneously in the market, the sphere of action of the law of value, its regulatory effect on prices is very much restricted and controlled under socialism. Prices are determined so that the law of balanced (proportionate) development of the national economy functions properly-and this is controlled thanks to the yearly and five yearly plans made based on this law- and the law of value is taken into consideration and utilised for this purpose.
Under socialism law of value operates and is utilised consciously to ensure the proper functioning of the prices mechanism and thus the proper functioning of the law of the balanced (proportionate ) development of the socialist economy.
Under socialism the profitableness considered from the standpoint of individual plants or industries, and over a period of say one year, is the temporary and unstable profitableness, and is not a regulator of socialist production while profitableness considered from the standpoint of the entire national economy and over a period of, say, ten or fifteen years, is the higher form of stable and permanent profitableness. This profitableness is achieved under socialism through the operation of the law of balanced (proportionate) development of the national economy and from economic planning. It is thus that under socialism the law of value does not regulate the profitableness, and thus the “proportions” of labour distribution among the various branches of production of national economy and thus does not regulate socialist production.
Under socialism the law of value does not regulates the “proportions” of labour distributed among the various branches of production. Primacy is given to the production of means of production-and amongst these to the implements of production- in favour of the production of articles of consumption. Because the national economy cannot be continuously expanded without giving primacy to the production of means of production.
In the second phase of communist society, the amount of labour expended on the production of goods will be measured not in a roundabout way, not through value and its forms, as is the case under commodity production, but directly and immediately—by the amount of time,
Law of value is not a permanent law: Value, like the law of value, is a historical category connected with the existence of commodity production. With the disappearance of commodity production, value and its forms and the law of value will also disappear
Dyachenko:
The Great October Socialist Revolution and thus the Soviet state, relying on the requirements of the economic law of the obligatory correspondence of production relations to the nature of the productive forces, smashed capitalism in Russia, abolished landlord ownership of land, nationalized all the land in the country, took away the means of production from the bourgeoisie, and transformed factories, plants, land, railways. Banks into the property of the entire people, the property of the whole people. But the private property of small and medium individual producers, mainly peasant farms with their backward technology, remained.
Based on these conditions LENIN-STALIN PLAN OF BUILDING SOCIALISM IN THE USSR was formulated and applied:
From Stalin:
“Lenin’s answer may be briefly summed up as follows:
a) Favourable conditions for the assumption of power
should not be missed—the proletariat should assume power without waiting until capitalism succeeded in ruining the millions of small and medium individual producer;
b) The means of production in industry should be expropriated and converted into public property;
c) As to the small and medium individual producers, they should be gradually united in producers cooperatives, i.e., in large agricultural enterprises, collective farms;
d) Industry should be developed to the utmost and the collective farms should be placed on the modern technical basis of large-scale production, not expropriating them, but on the contrary generously supplying them with first-class tractors and other machines;
e) Lenin’s answer may be briefly summed up as follows:
a) Favourable conditions for the assumption of power
should not be missed—the proletariat should assume power without waiting until capitalism succeeded in ruining the millions of small and medium individual producer;
b) The means of production in industry should be expropriated and converted into public property;
c) As to the small and medium individual producers, they should be gradually united in producers cooperatives, i.e., in large agricultural enterprises, collective farms;
d) Industry should be developed to the utmost and the collective farms should be placed on the modern technical basis of large-scale production, not expropriating them, but on the contrary generously supplying them with first-class tractors and other machines;
e) In order to ensure an economic bond between town and country, between industry and agriculture, commodity production (exchange through purchase and sale) should be preserved for a certain period, it being the form of economic tie with the town which is alone acceptable to the peasants, and Soviet trade—state, cooperative, and collective-farm—should be developed to the full and the capitalists of all types and descriptions ousted from trading activity.
The history of socialist construction in our country has shown that this path of development, mapped out by Lenin, has fully justified itself.
Dyachenko:
During the transition period from capitalism to socialism, the economy of the stata was multifaceted. The main socio-economic structures were the socialist structure, which consisted mainly of enterprises based on public property, and the small-scale trade structure represented by numerous small and medium-sized proprietors and producers. Along with them, there was a capitalist structure in the form of kulak farms, private trade, etc. The economy of the transitional period is characterized by irreconcilable struggle between socialism and capitalism according to Lenin’s formula “who beats whom; who wins”. The entire policy of the Communist Party and the Soviet state during the transition period was aimed at ensuring victory over capitalism, solving the problem of “who beats whom; who wins” in favor of socialism.
The Soviet state used commodity production and circulation to fight the capitalist elements, for the socialist alteration of the small-scale commodity order, for the rapid development and strengthening of the socialist order, for the victory of socialism in the city and countryside.
The enemies of the people, the restorers of capitalism tried to impose on the party a disastrous way of unleashing the market element, arguing that the whole essence of NEP is reduced to the admission of private trade, that trade and money circulation under the conditions of NEP were allegedly imbued with the principles of capitalism that the economy remain the same as under capitalism.
Next week we shall look at the present day views of commodity production and circulation and the value and law of value under the conditions of the rule of the restorers of capitalism, for countries under the conditions of transition to socialism such as Yugoslavia and European People’s Democracies and under socialism, that is under transition to communism such as USSR.