The labour theory of value has for over three centuries been a politically-expedient myth which has enabled the left to place moral claims on the material wealth produced in capitalist societies while creating an ethical divide between productive and unproductive groups and classes.
According to the traditional reading of the theory, the value of a commodity owes to the amount of labour objectified in it, and the particular problem with capitalism is that the workers who create it do not receive a fair share back from the capitalist. The influence of this theory upon the left is increasingly implicit, its logic stretched to breaking point in its extrapolation to the national and local level. Such visions suggest that the global expansion of a system shaped by the desires of profit-chasing capitalists has led to the emergence of an international financial and banking sector. Enabling money to be moved from one country to another, this makes it even harder for workers and their communities to claim a full or greater share of the value they create, whether by means of collective ownership or redistribution superintended by the state. By building up local and national state barriers to the global flow of capital, workers could ‘take back control’ of their labour and the value it creates. No longer would unproductive capitalists, global financial institutions or vested interests cream off profits from the productive popular subject, nor withhold investment from the ‘real’ economy or allow locally-produced wealth to ‘slide away’ from what Werner Bonefeld critically terms “the national community of hard-working people”.
This rests on what Philip Mirowski calls a ‘conservation’ or ‘substantialist’ theory of value as the property of a given thing in a given space or time. Mirowski traces the theoretical foundations of this perspective back to the ‘balance-of-trade’ mercantilist belief that a trading system of equivalent exchange must always mean, in the words of the philosopher Francis Bacon, that “whatever is somewhere gotten is somewhere lost”. This was tied up in the competitive imperialisms of the age of conquest, justifying inter-country rivalry on the basis that ‘trade is a zero-sum game’. Value is here taken to be something conserved, and to the extent the exchange in which it features is conducted with the national currency, containable within the borders of the state from which it arose – a monetary preoccupation that recurs in left policy imaginaries today.
Moreover, conservation theories of value contain an ‘isomorphic’ tendency to pose ‘productive’ sections of the economy against the ‘unproductive’, with all the reactionary consequences this accrues. This opposition, and the consequences it implies, also mark the intellectual imaginary of contemporary populisms right and left today. On the left, this moral vista of place-bound productive people and the products they create has traditionally played out on the terrain of industrial relations, pitching labour against capital through frameworks of collective bargaining; or at the level of the state, whether in the form of social-democratic redistribution or a Bennite ‘siege economy’. The last of these sounds a siren call to those today who seek to leave the Single Market because of State Aid restrictions, perceiving Lexit as a means to restore sovereignty against the forces of global capital.
The contemporary political scene sees traditional worker struggles sidelined for the will of the so-called ‘people’. Within this wider context of contemporary left policymaking, zero-sum claims to value have been devolved away from imaginaries fixated on the seizure of the nation state to a setting in smaller-scale localities and municipalities. This has a recent prehistory in the ‘folk political’ post-crisis parsimony of sustainable social innovations like ‘buy local’ schemes, local currencies, movements of ‘independents’, transition towns and so on. This has been given a socialist spin with John McDonnell’s intellectual reinvigoration of Labour policy, specifically with reference to the so-called ‘Preston Model’, where the council and other local ‘anchor institutions’ grant procurement contracts to local businesses, in turn assisted in applying for contracts, as well as new workers’ cooperatives plugging procurement gaps. Labour’s Alternative Models of Ownership (AMO) report argues that a Corbyn-led government should scale this up to the national level, using procurement policy to favour local supply chains and national firms, so as to stop nationally-produced wealth ‘leaking’ or ‘sliding away from localities.’
Thus in the AMO, the moralisation of the local walks in tandem with wider appeals to a more protectionist national state capable of withstanding the apparently parasitic force of global capital in order to ensure wealth stays within municipal or national borders. As two proponents put it, Corbyn’s Labour should reject “the icy-smooth frictionlessness of the single market” in favour of “the rooted participatory democratic local economy” swapping a series of externally imposed unproductive drains on value for new means of its production and capture: ‘the extractive multinational corporation’ for ‘worker- or community-owned firms’, for ‘asset-stripping privatisation, plural forms of democratised public enterprise’, and for “austerity and private credit creation by rentier finance, the huge potential power of public banks and post-scarcity sovereign fiat money.” This latter claim, specifically, rests upon the idea that a more moral form of money is made possible by enabling nation-states to step outside the international monetary system and gain more control over the currency as the means of conserving the value produced within their borders. In this way, it is akin to the same set of moral claims made around local and alternative currencies.
The establishment of such protective local and national economic structures, the AMO concludes, would “overturn the hierarchies of power in our economy, placing those who create the real wealth in charge.” It would “end decades of under-investment and wasted potential by tearing down the vested interests that hold this country back.” But moral pitches to render unto the national or local community of productive labour the value it is rightly due are dangerous – not only because of the nationalistic rhetoric involved, but because they make promises impossible to meet.
Rather than value being something inhering in things or places at a given time, an alternative perspective sees value as a relationship existing between things, constituted across and not in time and space. Labour itself is a concrete activity rooted in time and space, within a local and national context. But because value is a relationship between things mediated by money on a global scale, it does not reduce or inhere to a specific act or location of labour, but rather to the totality of labour and its products in society as a whole, which in a world market is to say on a global scale. The zero-sum idea that wealth ‘leaks’ away from national or local economies through global finance misses the fact that money, the form of wealth, is always a global affair. It doesn’t matter whether this money is national, local, alternative: its value is denominated in the plain old money we carry in our pockets, which in turn posits the relationship of what we did to earn it, and what we use it to buy, with all the other labour and commodities circulating likewise around the world. The state or some other municipal mode of ownership and control can attempt to direct this process through a different mediation temporarily suspending the central relationships and contradictions that grant capital its dynamism. But they cannot escape or resolve them, only reassure the productive community of its moral claim to the value presently extracted by the unproductive social forces, within and without, who ‘hold the country back’, as the AMO puts it. Meanwhile, our social domination under value’s negative totality remains untouched, in both theory and practice.
Matt Bolton is a postgraduate researcher in Philosophy at the University of Roehampton, UK.
Frederick Harry Pitts is Lecturer in Management at the University of Bristol, UK. He is the author of Critiquing Capitalism Today: New Ways to Read Marx.
Image Credit: Victor Kuznetsov / Alamy Stock Photo