The path to Engels’s reception of Darwin was paved by his increasing fascination with the progress of science. In a positively dithyrambic letter of July 14, 1858, Engels informed Marx that “people have, incidentally, no idea about the enormous progress made in the natural sciences over the last thirty years.” Both the “gigantic development of organic chemistry” and the improved use of the microscope had “revolutionized physiology. . . . Everything [living] is cell.” Physics had progressed equally rapidly, in particular the “correlation of forces,” the transformation of kinetic energy into heat, heat into light, or electricity into magnetism.
Engels did understand accurately two of the important trends of mid-nineteenth-century science: “cell doctrine,” the idea that living organisms are composed of cells; and the physical study of force and energy, moving away from the Newtonian focus on the mechanics of moving particles. In this same letter, Engels proceeded to identify these scientific discoveries with Hegel’s philosophical ideas: “The cell is the Hegelian thing in itself and in its development goes precisely through the Hegelian process, until finally the ‘idea,’ the respective complete organism develops out of it.” “Old man Hegel,” Engels went on, “would have enjoyed” learning about the new results of physics, the transformation of one kind of force into another. For the results of comparative physiology, “The Hegelian business about the qualitative leap in the quantitative row is also very nice here.”41
Engels wrote in 1865 to the German Darwinian and Malthusian socialist Friedrich Albert Lange, “I am naturally no longer a Hegelian but still have a great piety and attachment to the colossal old boy.” He conceded the “nonsense in the detail of the philosophy of nature,” but contended that “The modern scientific doctrine of the mutual interaction of the natural forces . . . is just another expression or rather positive proof of the Hegelian development of cause and effect, mutual interaction, force etc.”42 Engels was identifying Hegel with positivism, turning the latter’s methods of intellectual inquiry into the results of investigations in the natural sciences. Although Marx sometimes took a similar point of view, he was more inclined to contrast Hegel’s methods to the positivist ones.
If Engels saw dialectical philosophy, in good positivist fashion, as the expression of the natural sciences, he also could reverse the procedure, rejecting scientific findings when they did not fit his philosophical views. Denouncing the Second Law of Thermodynamics, he wrote to Marx: “You cannot imagine anything stupider.” The idea of gradual equalization of temperatures, or, as it would later be formulated, increasing entropy, led to a world “that begins in nonsense and ends in nonsense.” Although the second law was seen as “the finest and highest perfection of materialism,” it envisaged a progressive cooling of the universe. Such a development implied “the original hot condition, from which things cooled off, absolutely inexplicable, even absurd, thus presupposes a God.”43 Since, for Engels, philosophy included atheism and materialism, and that philosophy was based on the natural sciences, a science that led to a questioning of atheism and materialism could not be science.
We might imagine nineteenth-century (especially German) philosophical and social theory as placed along a line, at one end of which were Hegel’s ideas: the intellectually hegemonic position of philosophy, and the distrust of empirical evidence that had not been subject to philosophical investigation and criticism. At the other end would be the positivists, with their priority on scientific method and a scientific form of empiricism. The mature version of Marx’s theories, as well as can be gathered from their fragmentary expressions, seems to have been about halfway along the line, although in some instances he was much nearer the positivist end, at other times the Hegelian one. Marx, of course, reformulated Hegel’s idealism in materialist terms and replaced Hegel’s dialectical philosophy with a philosophically inflected political economy. Engels, by contrast, was far over at the positivist end of the line. In spite of his references to Hegel, the Wissenschaft he proposed as the basis for socialism was derived from the intellectual model of the natural sciences in its nineteenth-century positivist mode.
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The Economist
IN THE WAKE OF the global recession of 1857, Marx began writing his long-planned treatise on political economy. The idea of such a treatise had initially been conceived when he first studied the major political economists in Paris during the mid-1840s. In the following decade, exploiting the storehouse of knowledge in the British Museum, he had deepened his knowledge of economic theories and explored empirical evidence of the development of capitalism, writing up some results of his researches in his commentaries on business and finance for the New York Tribune. Influencing his interpretations were the theoretical reflections he had devised under and against the influence of positivism.
Marx’s plans for his treatise were expansive and ambitious. He would subject the ideas of the leading political economists of the day—particularly Adam Smith and his chief disciple, David Ricardo, but also Thomas Malthus, Jean-Baptiste Say, James and John Stuart Mill, to say nothing of many other, lesser figures—to Hegelian conceptual criticism. For all Marx’s disagreements with these theorists, he endorsed a number of their chief ideas, such as the determination of goods’ value by the labor required to produce them, the tendency in a capitalist society for the rate of profit to fall over time, and the relationship between the rent of land and differences in agricultural output. His Hegelian critique would not so much refute the proposals of these economists as it would reformulate their fundamental notions with greater theoretical precision and greater empirical accuracy. Finally, Marx would connect the tendencies of economic development that Smith and Ricardo had discerned with his theories of the stages of human history into a broad panorama of the violent rise, antagonistic flourishing, crisis-ridden decline, and revolutionary disappearance of capitalism.
It was a lot to do, and Marx’s initial efforts at the end of the 1850s turned into a quarter-century-long theoretical, empirical, and mathematical odyssey. Unlike Homer’s wily hero, Marx never reached an Ithaca of political economy, but continued to wander around an intellectual Mediterranean, with a few stops, of shorter and longer duration, at islands of publication. While he was on his journey, both the economic landscape of nineteenth-century capitalism and the intellectual landscape of economic thought were changing around him. The intellectual voyage was only finished after his death. In the following decade, painstakingly deciphering Marx’s scrawled script and laboriously reconciling his different draft manuscripts and extensive notes, Engels compiled and published the rest of Marx’s treatise. By the time it appeared, most economists lived in a different intellectual universe from that of Smith and Ricardo; Marx’s efforts to reaffirm the economic orthodoxy of the mid-nineteenth century appeared as a dissenting and unorthodox economics four decades later.
Marx’s initial unpublished draft of 1857–58 is known as the Grundrisse (German for “construction sketch” or “blueprint”), a name given it by the Russian editors who first published the manuscript in 1939. This preliminary attempt, 800 pages strong, was a variegated work, mixing carefully structured arguments with isolated comments, well-connected passages with random insights, and issues from the Paris manuscripts of 1844 with observations from Marx’s journalism of the 1850s. For all the fragmentary, non-linear nature of the manuscript, it contained basic themes of Marx’s economics that he would pursue for the rest of his life. A few excerpts from the Grundrisse appeared in the slender On the Critique of Political Economy, published in Berlin in 1859, a work that was the proverbial tip of the iceberg. The pamphlet dealt primarily with money and economists’ monetary theories, revealing little of the thematic wealth of its unprinted predecessor.
Marx worked on his economics treatise with heightened intensity in the first half of the 1860s, producing a better-structured draft of the entire work in 1861–62, which included a history of economic thought not found in later manuscripts, and eventually published separately a
s Theories of Surplus Value. A third, and by far the best organized and clearest version of the treatise, was written in 1864–65. It had grown too long to be published all at once, so Marx excerpted the initial 40 percent and revised it extensively for publication. This became Volume One of Capital, which was published in Hamburg in 1867. In the 1870s, Marx made a number of changes and corrections to this work for the second German-language edition of 1873, and the French-language edition, published two years later. An English-language version, in spite of Marx’s efforts to procure a translation and publisher, only appeared in 1887, after his death.
All these printed versions left the majority of Marx’s planned treatise still unpublished. Marx hoped to have the remainder of the work done shortly after the first volume appeared, and he continued to work on the book until the last year of his life. But his efforts after 1867 remained scattered and fragmentary; when Engels collected, organized, and transcribed Marx’s writings posthumously, he had to have recourse to the manuscripts from the 1860s. Although Volumes Two and Three of Capital, as edited by Engels, were published in 1885 and 1894 respectively, in most respects Volume One was written after Volumes Two and Three and on many important topics contained Marx’s latest thinking and formulations.1
Summarizing, criticizing, and placing in historical context this giant mass of published and unpublished material would demand a book—many books!—in itself. Readers, I hope, will be content with a briefer account, beginning with the Hegelian conceptions of Marx’s work, outlining Marx’s main economic concepts, and showing how these were developed into a diagnosis of nineteenth-century capitalism and a prognosis of its ultimate demise. Three crucial features of Marx’s economic theory—the tendency of the rate of profit to fall; the so-called transformation problem, the transformation of values into prices across an entire capitalist economy; and the determination of farm prices and ground rent—remained unpublished during his lifetime. Marx’s struggles with the problems inherent in these features illuminate the relationship between his ideas and those of his predecessors and contemporaries. In the last third of the nineteenth century, growing discontent with existing theories of political economy led to the development of two new and strongly opposed versions of economics: the “Historical School” and neoclassical marginal utility theory. The reception of Marx’s ideas and the criticisms by adherents of these newer trends demonstrates how Marx’s ideas were shaped by his predecessors and by the socioeconomic environment in which they lived. In contrast, there was much less in Marx’s work relevant to trends either in the economy or the economic theory of the late nineteenth and twentieth centuries.
CAPITAL BEGAN WITH THE simple perception of the capitalist economic system as an immense number of useful goods produced and exchanged. (The German Ware, goods for exchange or sale, is usually rendered in English as “commodities,” a bit misleading, since Marx did not have in mind the contemporary meaning of commodities as raw materials, but goods and services more generally.) If goods, having incommensurable uses—cloth on the one hand and grain on the other—were to be exchanged, they needed some common measure of value, so their exchange implied the existence of a currency, transforming bartering goods into selling them, trading them for money. Trading goods to increase one’s store of money, rather than to exchange one good for another, Marx continued, was what made money into capital. This kind of exchange, increasing wealth and value, he argued, was only possible through the exchange of money with a specific kind of commodity, human labor power.
The rest of Volume One of Capital then explained the implications of that exchange: its relationship to the workday, its differentiation of kinds of capital, and its role in creating surplus value, the increase in wealth enjoyed by capitalists as a result of their exchange with workers. Marx elaborated the production of surplus value, including a detailed investigation of the factory system, the changes in the working day, changes in employment and in the structure of capital, and long-term trends in the distribution of the income resulting from the growth of a capitalist economy. The development of these concepts and their empirical investigation took up most of the first volume of Capital.
While surplus value had been extracted by the exchange between capitalists and workers, it still had to be realized—that is, the goods workers produced had to be sold in the market, for capitalists to make a profit. If Volume One of Capital was about distribution, Volume Two became an investigation of circulation, of the process of buying and selling in the market. Volume Three then returned to the process of production in light of the results on circulation. This work dealt with the transformation of value (whose extraction was considered in Volume One) through sale (Volume Two) into price and relationship of this transformation to the falling rate of profit—both processes considered in regard to the whole economy, and not just individual firms. Volume Three also considered specialized issues emerging from the intersection of production and circulation, such as currency, credit, and finance, and then specific forms of capitalism, including agriculture, mining, and urban real estate. The volume and the work ended—or was designed to end, because Marx never completed even a rough draft of this final section—with an explanation of the differences between Marx’s analysis of capitalism and that of Smith and Ricardo, and an invocation of the capitalist economic system’s structuring of a class society.
This form of proceeding was fundamentally Hegelian. Authors have compared Marx’s economic treatise with Hegel’s Logic.2 A more appropriate comparison might be to another of Hegel’s works, the Phenomenology of Spirit, which began with simple, immediate sense perception, and moved up a conceptual ladder of increasing complexity, each rung in the ladder generated by the ultimate inadequacy of the previous one, as it was more carefully elaborated. Capital began with the simplest forms of economic activity, the production and exchange of goods, and developed a theoretical structure of increasing complexity, each step emerging out of the inadequacy of the previous one: money needed to explain how objects with incommensurate uses could be exchanged, the nature of labor power to explain how equal exchanges could produce profits, the analysis of circulation to explain how extracted surplus value could be realized, to give just a few examples. At the end of the analysis was a complex class society, containing all its inequalities and tendencies toward self-destruction.
A crucial part of Hegel’s process of conceptual and historical development was the movement of self-externalization and self-estrangement, in a word, alienation, and the recovery of the capacity and material that had been alienated. As early as the Paris manuscripts of 1844, Marx had transformed Hegel’s insights into an explanation of political economy, in his discussion of the alienation of labor under capitalism. Whole passages in the Grundrisse were just repetitions of these viewpoints, first written down fifteen years previously. In Capital, Marx did not use the language of alienation and self-estrangement, but he did talk about the “fetishism of commodities,” the way capitalism turned the process of the actualization of human labor into a thing, a commodity, or good for sale, distinct from the workers who had produced the commodity and holding power over their lives.3
If Marx’s use in Capital of the concept of commodity fetishism is evidence of a link to ideas from the 1840s, his opposition of secrets to semblances, and his description of inner connection and inner logic as the truth in his economic work, reflected his methodology after 1850 and his ambivalent feelings about the increasingly dominant positivist understanding of knowledge. In describing the fetishism of commodities, Marx stated that “The mysterious character of the commodity form thus simply consists of the fact that it reflects back to men the societal character of their own labor as the objective characteristics of the labor product itself. . . . thus also reflects the social relationship of producers to their total labor as a social relationship of objects existing outside themselves.”4 This passage, reminiscent of the philosophical analysis of the Paris manuscripts, pointed out the difference between appearance and inner
logic. Goods appear in the marketplace, are sold at market prices that appear independent of individual control; but this appearance veils the inner logic of the labor process, the production of those goods by workers, who have lost control of the products of their own social labor.
This evocation of secrets as the inner logic of an empirically perceived semblance was most noticeable in the unfinished third volume, in which Marx planned to bring his entire system together as a totality and to compare it with the ideas of the classical political economists. At the beginning of Volume Three, he insisted that surplus value was the hidden form of profit, that the rate of profit and idea of value emerging from credit were both a “semblance,” while the rate of surplus value was “the invisible, but the essential to be discovered.” Marx felt that in distinguishing between the rate of profit and the rate of surplus value, he had “for the first time uncovered this inner connection.” He insisted that supply and demand, which bourgeois economists asserted determined prices, was just a semblance, rather than the reality of value determined by labor time, which could only be found by investigation of the inner connections of value.5
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