Das Kapital – A Demystification of Capitalism

In the autumn of 1883 a young Irish writer named George Bernard Shaw read a book

titled Das Kapital. Reflecting on it much later, he credited the book as the “turning point in my

career. Marx opened my eyes to the facts of history and civilization, gave me an entirely fresh

conception of the universe.” Shaw praised Das Kapital for having “achieved the greatest feat of

which a book is capable – that of changing the mind.”1 In his 1942 book Socialism and

Democracy, Joseph Schumpeter, a famed Keynesian and zealous capitalism supporter,

recognized Karl Marx’s genius and even shared Marx’s terminal diagnosis of capitalism (in the

long term), albeit minus the pleasure. More recently, in 1998, widely known speculator and

billionaire George Soros praised Marx’s economic insight. Soros wrote in his own book that

Marx had provided “a very good analysis of the capitalist system.”2

It might appear strange that a contemporary billionaire would praise the 150 year old

work of the German revolutionary Karl Marx, widely known as the father of communism. It

becomes less strange when one meditates on Marx’s opus magnum, his most ambitious work,

Das Kapital. In it one is confronted with a towering work of genius both in its scope and breadth

that commands respect. Marx was born in Trier, Prussia in 1818. As a young man he attended

Bonn University for a year before he transferred to the University of Berlin from which he

earned a doctorate degree in philosophy. Much later Marx called upon his vast knowledge of

various fields, including German Hegelian dialectical philosophy, English political economy,

and French socialist revolutionary thought, synthesizing them into scientific socialism, today

better known as Marxism.

1 Francis Wheen, Marx’s Das Kapital: a biography. (New York: Atlantic Monthly Press, 2007), p. 90.2 Ibid., pp. 115-116.

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Intellectually, while still at Berlin University the young Marx was heavily influenced by

the German philosopher G.W.F. Hegel, and the Young Hegelian movement, whose ranks Marx

joined, that emerged shortly after Hegel’s death. Although Marx rejected Hegel’s ultimate

conclusion that history was the working out of the world spirit, he defended Hegel’s claim that

history was a dialectical process of working out. In other words, Marx defended Hegel’s conflict

theory that saw history unfolding through ever higher levels of synthesis resulting from the

conflict between antitheses – or opposing forces. But whereas Hegel saw the source of this

conflict, and the purpose of history, as an idealist becoming of a world spirit, for Marx, the

source was simply the material struggle of classes. This view Marx famously expressed in the

Communist Manifesto with the famous words, “The history of all hitherto existing society is the

history of class struggle.”

Other Young Hegelians, particularly Ludwig Feuerbach, had done much to expel gods

and religion from philosophy, just as previously kings had been chased from politics. But Marx

detected strange stirrings in the ostensibly innocuous and common market place, which he came

to see, in Wolff’s words as more “deeply mystified than ever the altar or the throne had been."

The deeper Marx penetrated into the “scientific” explanations of the classical economists the

more he discovered how “wildly metaphysical” they were. Since none of these economists, even

when confronted by the strangeness of the commodity, acknowledged any mystery, the task of

demystification had never even been conceived of as a necessary undertaking until Marx came

along.3 Marx considered this an extremely important task because as a materialist for him the

economic sphere constituted the basis or foundation from which all human relations emerged.

This understanding he later refined and it was termed the materialist conception of history.

Mystification of the economic sphere, central as it was to collective human existence, must

3 Robert Paul Wolff, "How to Read "Das Kapital"," The Massachusetts Review 21, No. 4 (1980), p. 744.

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therefore serve to obfuscate every other relation throughout the whole of society. Therefore,

before Marx could build his own system, scientific socialism, around economic reality,

economics itself first had to be demystified. The fruit of this intensive labor was what eventually

filled the pages of Das Kapital.

Das Kapital is, therefore, essentially an extensive treatise on political economy aimed at

providing a critical analysis of capitalism. In it Marx delved into the nature of commodities,

wages and what he believed was the real source of profits, for the primary purpose of unmasking

the human relations capitalism had kept well hidden, but no less so, to show that capitalism

"contained the seeds of its own destruction.”4 In the terminology of nineteenth century science,

Marx discovered certain “laws of motion” of the capitalist system as a whole. But he was not a

mechanical thinker. He understood capitalism to be a dynamic system, which had evolved over

time through a continuous process that propelled scientific innovation and organizational

methods.

In addition to being charged with mechanical or deterministic thinking, Marx has

occasionally been accused of being utopian as well. But this too is unwarranted. Marx never

bothered to speculate about socialism nor did he take seriously those who did. He preferred to

investigate and analyze the historical development of capitalism as it existed to understand the

laws of society and social transformation. Marx decided to go after the capitalists not with

utopian fantasies, but by employing their own economic science against them.5 Far from the

utopians of his time with their elaborate descriptions of socialism, at most Marx’s work showed

how the development of capitalism was tending, through its inner contradictions, toward a new,

higher socialist mode of production. Thus, without concerning himself with what could only be

4 Bertram D. Wolfe, "Das Kapital One Hundred Years Later," The Antioch Review 26, No. 4 (1967), p. 434.5 Albert Resis, "Das Kapital Comes to Russia," Slavic Review 29, No. 2 (1970), p. 226.

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speculations about these future developments and the new culture arising from them, Marx set

out instead to provide a scientific foundation for the labor movement.

In preparation for the immense intellectual task ahead, Marx undertook a long study of all

things political economy. From his Paris notes, which eventually became the rough drafts to Das

Kapital, we know that in 1843 he systematically went through the work of Smith, Ricardo and

Mill.6 After being expelled from Paris following the 1848 failed revolutions, he eventually

arrived in London were he gained access to a vast store of economics knowledge. In June 1850,

he got a ticket to the library in the British Museum, and spent the next year reading books on

economics and back issues of The Economist. He’d do this almost daily, from nine in the

morning to seven in the evening.7 A plethora of valuable data was just becoming available

because of the British Factory Act of 1850. The Factory Act, which limited the British working

week to 60 hours, also created a small army of factory inspectors. It was these inspectors’ reports

that furnished Marx with material for his own descriptions of the conditions of the British

working class, which was arguably the most potent section of Das Kapital.8

While Marx carried out continuously and extensive research on every topic

pertaining to capitalist economics at a fast pace, the writing down of his own discoveries turned

out a much more painstakingly slow process than he had imagined. Early on he had

unrealistically promised to deliver the first volume to his publisher by summer of 1845.9 It would

not be published until much later. Volume one was published in Hamburg on 5 September, 1867.

It would be the only volume Marx finished in his lifetime. His extensive notes for the other

volumes, in various stages of completion, were used by supporters to complete the other three

6 Wheen, Marx’s Das Kapital, p. 14.7 Ibid., p. 23.8 Ibid., p. 50-51.9 Ibid., p. 18.

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volumes after Marx’s death in 1883.10 The second volume appeared in 1885, followed by a third

in 1894. These two were compiled by Engels. And what has been called the fourth volume,

“Thesis on Surplus Value,” was edited in 1905 by Karl Kautsky.11

Marx began his critical analysis of capitalism with a detailed investigation into

commodities. He identified the dual nature of commodities, which had both a use-value and an

exchange-value. The exchange-value, which ultimately determined market price, was the more

important of the two because it was a function of the quantity of labor-power that went into the

production of any commodity. It had been for the purpose of hiding labor as the source of value

that the economists had mystified the nature of commodities – albeit with scientific sounding

language. This mystification of commodities, Marx termed commodity fetishism.

As a result of commodity fetishism, Marx observed in the open chapter of Das Kapital, a

commodity appeared to be a “very weird thing, abounding in metaphysical subtleties and

theological niceties.”12 Commodity fetishism, which resulted from disavowing labor-power as

the exclusive source of a commodity’s exchange value meant that economists were forced to

locate a mystical intrinsic value, or a value of things within the material itself. These intrinsic

value notions consequently mystified the production process and, with them, all the human social

relations that arose from them. Marx noted the similarity between commodity fetishism and

religious fetishism. He remarked that just as in religion “the products of the human brain [i.e.

Gods] appear as autonomous figures endowed with a life of their own, which enter into relations

both with each other and with the human race. So it is in the world of commodities with the

products of men’s hands.”

10 Ibid., p. 6.11 Ibid., p. 38.12 Wolff, "How to Read “Das Kapital”,” pp. 747-748.

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A scientific search for intrinsic value was senseless, for just as science could only furnish

evidence against, and never for, religion, likewise, Marx concluded with a sense of irony, “no

chemist has ever discovered exchange value either in a pearl of a diamond.”13 This mystification

was important to capitalism. The popular claim that value existed within the material itself had

not been, in Marx’s words, a “mere logical error, an intellectual confusion to be cleared away,”

but it was, he asserted, “a necessary mystification without which capitalism could not

function."14 Not without warning then did Marx chart a journey for the reader of Das Kapital

through a fantasy world of specters and apparitions where nothing was as first appeared. Marx

considered the reader’s undertaking of this strange journey as the necessary prerequisite for

penetrating the veils of illusion behind which capitalism’s exploitative nature is hidden.15

This separation of the commodity from the source of its value, the worker’s labor-

power, which mystified the commodity, could not be carried out without an equally negative

effect on the worker. The severance between the worker and his labor led to a phenomenon that

Marx made central to his theory, called alienation. Wheen claimed that Marx’s personal

experience might even have contributed to the intensity of his analysis on the alienation caused

by capitalism. Marx was “an outsider,” born a Jewish boy in Trier, a predominantly Catholic city

at a time when the professions were barred to Jews. Heinrich Marx, Karl’s father, sought relief

from this discrimination through conversion to Lutheranism, which further alienated Marx, this

time from his family’s roots.16 How much Marx’s personal experience may have contributed to

his analysis of alienation is debatable, but what is clear is that Marx’s use of alienation was tied

directly to the economic relations. His precise use of the term referred to the experience of the

worker under capitalism who found himself alienated from the product of his work. In other 13 Wheen, Marx’s Das Kapital, pp. 43-44.14 Wolff, "How to Read “Das Kapital”,” p. 749.15 Wheen, Marx’s Das Kapital, p. 39.16 Ibid., p. 7.

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words, the final outcome of the worker’s activity work became a thing foreign to him, and owned

by another, the capitalist. But if alienation was the effect, then capitalists’ need to extract unpaid

labor from the worker for profit making, which Marx termed exploitation, was the cause.

Much of Das Kapital was aimed at exposing the mechanism by which the capitalist class

exploited, or extracted profits, from the working class. The secret to capitalism, Marx believed,

was that it presented itself in a manner that concealed its fundamental exploitative nature, and

therefore, in Wolff’s words, “appear to have nothing to hide."17 Having momentarily allowed for

the possibility of the popular notion that profits were to be found during the exchange of finished

goods on the market, Marx took the reader on a long search that ended in vain. Instead of profits,

what we discovered in the market place, as the classical political economists had known, is the

exchange of equivalent goods. But this raised the question: if profits were not to be found in the

market place then where?

If profits were not created in circulation then Marx reasoned that “something must take

place in the background which is not apparent in the circulation itself.” The answer had already

been revealed by David Ricardo who asserted that profits were derived from wages.18 But Marx

desired to go further. He sought to uncover the necessary, yet hidden, condition for the extraction

of profit from labor during the production process. Marx discovered that profit making was

possible because capitalism exploited a special feature of the worker-as-commodity.

Previously, Marx had shown that commodity fetishism, by veiling the social relations

involved in the production of commodities, had led to mystifying observations about the dual

nature of commodities. Now he extended that strangeness to men, which he explained, capitalism

had turned into commodities.19 Labor as a commodity exhibited a strange dual nature. Marx

17 Wolff, "How to Read “Das Kapital”,” p. 745.18 Ibid., pp. 750-752.19 Wheen, Marx’s Das Kapital, p. 13.

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observed that labor-power as commodity had the self-expanding capacity to create new exchange

value in the process of being consumed by its purchaser, the factory owner.20 Or, in the ironic

language characteristic of the more memorable passages in Das Kapital, Marx quipped that

labor-power had the “occult ability to add value to itself. It brings forth living offspring, or at

least lays golden eggs.”21

In this context, exploitation meant that the capitalist paid for a certain amount of time of

labor-power and kept the product created during that time, which was worth more than the value

of the labor-power that had produced it. Whereas classical economists like Ricardo had already

posed a labor theory of value – the understanding that labor was the source of all new value –

Marx had gone further and shown that the capitalist’s goal for profits could only be achieved by

exploiting the fact that he extracted more value from a worker’s labor-time than that for which he

had paid. This was possible because the worker as a commodity had his value determined, like

every other commodity, by how much value was used to produce it. In the case of a worker this

meant his daily cost-of-living, which included things like his daily food intake and rent cost.

Profits could not have arisen otherwise, since, in Marx’s opinion, “there is not one single

atom of [surplus] value that does not owe its existence to unpaid labor.”22 Therefore, Marx

concluded, capitalism rested upon the exploitation of labor-power,23 and this was the reason why

economists insisted on focusing on the market place. It was only in the market place that they

could talk about freedom – the freedom to buy and sell – and equality – the right to exchange a

thing for another of equal value. But the appearance of equality in the market place was the

necessary and indispensible flipside to the realization of profit whose origin was found in the

20 Wolff, "How to Read “Das Kapital”,” p. 756.21 Wheen, Marx’s Das Kapital, p. 48.22 Ibid., p. 50.23 Wolff, "How to Read “Das Kapital”,” p. 756.

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production of commodities, not in their exchanges. Or as Wolff wrote, "the real world lies

behind the factory door, and not in the open air of the marketplace."24

But could not it be said that this kind of exploitation of labor was harmless if it meant

ever higher productivity and an absolute increase in the wealth of nations? After all, even Marx

and Engels, in the Communist Manifesto, had praised the tremendous wealth-generating power

brought forth by capitalist improvements in technology and rising levels of productivity. In Das

Kapital he was able to go deeper into capitalism as a historical development, one in which he

showed that increasing amounts of material wealth were undermined by the simultaneous drive

of capitalism to diminish the economic value of that wealth. This ceaseless undermining of its

own products was the cause of the crisis of overproduction, in which Marx located the endless

economic crises that had plagued capitalism from its inception. In addition to diminishing

already existing value, greater productivity of labor, invariably led to a relative rise of the

industrial reserve army (Marx’s term for a permanent army of the unemployed required by

capitalism to maintain wages down). Whereas earlier economists had focused on the

accumulation of wealth, the laws of capitalism were such that this historic “accumulation of

wealth at one pole,” said Marx, “was at the same time accumulation of misery, the agony of toil,

slavery, brutality, ignorance, moral degradation, at the other."25

We saw how Marx attached a very precise definition and technical meaning to the term

exploitation as the capitalist’s mechanism by which the wages a worker received covered the

cost of his upkeep but not the actual value produced by his labor-time. That surplus-value the

worker created beyond his own maintenance cost, in the form of a wage, was pocketed by the

capitalist as surplus. This definition was very different from the more popular notion of

24 Ibid., pp. 763-764.25 Wolfe, "Das Kapital One Hundred,” p. 435.

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exploitation, still used today, synonymous with sweatshop conditions. But although he did not

use exploitation to mean sweatshop conditions, Marx wrote ample in Das Kapital about such

conditions.

His description of the horrors that capitalism inflicted on the British workers was

probably the most accessible, and on that account popular, section of the first volume of Das

Kapital.26 Supplementing Marx’s demystification of capitalism, a task that almost took up the

first two hundred pages, was chapter ten, called “The Working-Day.” It was in chapter ten that

Marx brought the reader face to face with the gritty reality and distorted human face of the

victims of capitalism. Here Marx was most concerned with the negative effects of capitalism on

workers. He made vivid connection between overwork and the workers’ early deaths, and he

detailed the kind of repetitive, mindless work that degraded men to little more than machines.27

Wheen referred to this chapter as a “compendium of horror stories, framed by Marx in suitably

Gothic style.”28 Using similar language, Wolfe wrote of this chapter that its “richness of detail,

and horrifying vividness of description, provides a dramatic counterbalance to the long stretch of

theoretical chapters that precedes it," and that having lifted the veil on the technical workings of

capitalism, we are “permitted to see, to hear, to feel, with sensuous immediacy the torments of

the factory workers."29

Das Kapital was based on a detailed study of British capitalism, but Marx believed his

works’ relevancy extended far beyond England. As the most advanced industrial society of its

time, Britain, Marx argued, would soon reshape Western Europe in its own image. As for the

German reader, Marx warned, if he “shrugs his shoulders at the condition of the English

industrial and agricultural laborer, or in the optimistic fashion comforts himself with the thought 26 Resis, "Das Kapital Comes to Russia," p. 228.27 Wheen, Marx’s Das Kapital, p. 15.28 Ibid., p. 51.29 Wolff, "How to Read “Das Kapital”,” pp. 759-760.

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that in Germany things are not nearly so bad, I must plainly tell him, 'de te fabula narratur' (this

story is told of you)." Marx was convinced that Germany would follow Britain down the

industrial road.30 Despite his warning, Das Kapital was at first met not so much with a shrug of

the shoulder, as with what Marx and his colleagues complained was a “conspiracy of silence” on

the part of “a pack of liberals and vulgar economists."31 There were few reviews and it took four

years to sell the first 1,000 copies.32

In Russia, which had previously banned books by Marx and Engels, and had explicit

censorship rules rejecting works that espoused communism, or conflict between the classes, Das

Kapital was allowed publication. The censors were convinced that the work was inaccessible.

The official censorship reader described the book as “a difficult, inaccessible, strictly scientific

work," which was therefore of no threat to the state. The censors were aware of the book’s

powerful, moving descriptions of the conditions of the British working class, but they concluded

that it did not apply to Russia, and that it was in any case too buried in a "colossal mass of

abstruse, somewhat obscure politico-economic argumentation" to be of any real consequence.33

Through lack of foresight the censors failed to take into account that Russia was beginning to

industrialize and would soon enough assume the capitalist characteristics described in Das

Kapital.34 Not everyone was as shortsighted as the censors. Das Kapital’s account of the British

modernization process was perceived as important by those whom like Marx had the foresight to

understand that many countries would soon be forced onto the path of industrialization.35 This

30 Resis, "Das Kapital Comes to Russia," p. 233.31 Ibid., p. 219.32 Wheen, Marx’s Das Kapital, p. 84.33 Resis, "Das Kapital Comes to Russia," p. 221.34 Ibid., p. 232.35 Ibid., pp. 224-225.

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explained why having passed by the Russian censors, Marx sold most of the 3,000 Russian

copies of Das Kapital within the year.36

Das Kapital was conceived centrally as a work of economics, but it is also much more

than that. Philosophy and literature constitute its intellectual foundation. Philosophically, Marx’s

exposition of capitalism was carried out utilizing the dialectical method. This method had been

derived from Hegel who in turn had synthesized, as Wheen noted, “many previous dialectical

forms – from Zeno’s paradoxes to Kantian critique.” Marx was clear that his application of the

dialectical method was not only derived from Hegel’s but in a fundamental way was its

diametrical opposite because Marx, unlike Hegel, recognized the material world as primary.

Whereas Hegel saw the dialectical happenings in the real world as nothing but an expression of

the working out of what he termed the Absolute Idea, Marx recognized that the dialectic was the

happenings of the real world as expressed in thought.37 A letter from Marx to Engels the year of

Das Kapital’s publication also suggested that the use of the dialectical method for exposition

served another functional purpose: “the good thing about this [dialectical] method is that it is

constantly setting traps for those fellows [‘vulgar economists’] which will provoke them into an

untimely display of their idiocy.”38 This blending of philosophy and economics prompted the

first German review of Das Kapital to accuse Marx of “Hegelian sophistry,”39 but it also earned

him praise from Ferdinand Lassalle (first leader of a German labor party), who called Marx

“Hegel turned economist, a Ricardo turned socialist.”40

Whereas the dialectical method permeated the exposition and development of the ideas in

Das Kapital, an artistic literary approach constituted the form or overall presentation. This was

36 Wheen, Marx’s Das Kapital, p. 85.37 Ibid., p. 63.38 Ibid., p. 111.39 Ibid., p. 79.40 Ibid., p. 28.

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no accident. Early on Marx had declared his ambition of producing a work of art.41 The project

had been from its inception conceived as an “artistically unified rendering” of the philosophical,

economic, cultural and historical aspects pertaining to capitalist society.42 Marx went beyond

conventional prose, embracing what Wheen described as a “sort of radical literary collage,”43

which gave to much of Das Kapital a “Dickensian texture.”44 In 1976, Professor S.S. Prawer

went much further. The Professor wrote a whole book solely focused on the literary aspect of

Das Kapital. The book was 450-pages long and concluded that Das Kapital contained quotations

from “the Bible, Shakespeare, Goethe, Milton, Voltaire, Homer, Balzac, Dante, Schiller,

Sophocles, Plato, Thucydides, Xenophon, Defoe, Cervantes, Dryden, Heine, Virgil, Juvenal,

Horace, Thomas More, Samuel Butler,” as well as, “allusions to horror tales about werewolves

and vampires, German chap-books, English romantic novels, popular ballads, songs and jingles,

melodrama and farce, myths and proverbs.”45

Why such a lively treatment of economics, which even today is known as the dismal

science. Marx once remarked that from the standpoint of everyday appearances, scientific truth

often appeared paradoxical, as it were, capturing only the “delusive nature of things.” Wheen

suggested an excellent answer. Wheen claimed that the literary style employed in Das Kapital

was the only appropriate style that could express capitalism’s delusive nature and that only

Marx’s ample use of irony could do justice to the “deranged logic of capitalism.46

In the wake of the collapse of the Soviet Union and the Socialist Bloc, economists, social

theorists and intellectuals of all stripes eagerly proclaimed the death of Communism and

consigned Marx’s work to the dustbin of history. However, only a few years many were

41 Ibid., p. 74.42 Wolff, "How to Read “Das Kapital”,” p. 765.43 Wheen, Marx’s Das Kapital, p. 4.44 Ibid., p. 72.45 Ibid., pp. 74-75.46 Ibid., pp. 80-81.

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questioning whether that proclamation had been justified. Presently, in light of the economic

crisis following the financial crash of 2008, there has been a resurgence of interest in Marx’s Das

Kapital. But even as early as October 1997, when the United States economy was marching

along and the I.T. industry was booming, creating employment prior to the 2001 crash of the dot-

com speculative bubble, many perceptive people were having second thoughts about Marx’s

supposed irrelevancy. John Cassidy, the economics correspondent of the New Yorker, reported a

conversation with an investment banker in New York. Cassidy’s article quoted the banker as

such: “The longer I spend on Wall Street, the more convinced I am that Marx was right. There is

a Nobel Prize out there for an economist who resurrects Marx and puts it into a coherent

theory.”47

47 Ibid., p. 118.

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Bibliography

Resis, Albert. "Das Kapital Comes to Russia." Slavic Review 29, No. 2 (1970): pp. 219-237. http://www.jstor.org/stable/2493377 (accessed June 22, 2011).

Wheen, Francis. Marx's Das Kapital: a biography. New York: Atlantic Monthly Press, 2007.

Wolfe, Bertram D.. "Das Kapital One Hundred Years Later." The Antioch Review 26, No. 4 (1967): pp. 421-441. http://www.jstor.org/stable/4610797 (accessed June 22, 2011).

Wolff, Robert Paul. "How to Read "Das Kapital"." The Massachusetts Review 21, No. 4 (1980): pp. 739-765. http://www.jstor.org/stable/25089097 (accessed June 22, 2011).

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