Thesis: the Soviet Union was capitalist by Marx's standards and by Stalin's admission

The wealth of those societies in which the capitalist mode of production prevails, presents itself as “an immense accumulation of commodities,” its unit being a single commodity. Our investigation must therefore begin with the analysis of a commodity.

A commodity is, in the first place, an object outside us, a thing that by its properties satisfies human wants of some sort or another. The nature of such wants, whether, for instance, they spring from the stomach or from fancy, makes no difference. Neither are we here concerned to know how the object satisfies these wants, whether directly as means of subsistence, or indirectly as means of production.

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It is sometimes asked whether the law of value exists and operates in our country, under the socialist system.

Yes, it does exist and does operate. Wherever commodities and commodity production exist, there the law of value must also exist.

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In order to be sold as a commodity in the market, labour must at all events exist before it is sold. But, could the labourer give it an independent objective existence, he would sell a commodity and not labour. Apart from these contradictions, a direct exchange of money, i.e., of realized labour, with living labour would either do away with the law of value which only begins to develop itself freely on the basis of capitalist production, or do away with capitalist production itself, which rests directly on wage-labour.

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In our country, the sphere of operation of the law of value extends, first of all, to commodity circulation, to the ex-change of commodities through purchase and sale, the ex-change, chiefly, of articles of personal consumption. Here, in this sphere, the law of value preserves, within certain limits, of course, the function of a regulator.

But the operation of the law of value is not confined to the sphere of commodity circulation. It also extends to production. True, the law of value has no regulating function in our socialist production, but it nevertheless influences production, and this fact cannot be ignored when directing production. As a matter of fact, consumer goods, which are needed to compensate the labour power expended in the process of production, are produced and realized in our country as commodities coming under the operation of the law of value. It is precisely here that the law of value exercises its influence on production. In this connection, such things as cost accounting and profitableness, production costs, prices, etc., are of actual importance in our enterprises. Consequently, our enterprises cannot, and must not, function without taking the law of value into account.

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... This jeremiad is also interesting because it shows how the appearance only of the relations of production mirrors itself in the brain of the capitalist. The capitalist does not know that the normal price of labour also includes a definite quantity of unpaid labour, and that this very unpaid labour is the normal source of his gain. The category of surplus labour-time does not exist at all for him, since it is included in the normal working day, which he thinks he has paid for in the day’s wages. But over-time does exist for him, the prolongation of the working day beyond the limits corresponding with the usual price of labour. Face to face with his underselling competitor, he even insists upon extra pay for this over-time. He again does not know that this extra pay includes unpaid labour, just as well as does the price of the customary hour of labour.

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Is this a good thing? It is not a bad thing. Under present conditions, it really is not a bad thing, since it trains our business executives to conduct production on rational lines and disciplines them. It is not a bad thing because it teaches our executives to count production magnitudes, to count them accurately, and also to calculate the real hings in production precisely, and not to talk nonsense about "approximate figures," spun out of thin air. It is not a bad thing because it teaches our executives to look for, find and utilize hidden reserves latent in production, and not to trample them under-foot. It is not a bad thing because it teaches our executives systematically to improve methods of production, to lower production costs, to practise cost accounting, and to make their enterprises pay. It is a good practical school which accelerates the development of our executive personnel and their growth into genuine leaders of socialist production at the present stage of development.[/b]

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On the other hand, it is evident that the duration of the surplus labour is given, when the length of the working day, and the value of labour-power, are given. The value of labour-power, i.e., the labour-time requisite to produce labour-power, determines the labour-time necessary for the reproduction of that value. If one working-hour be embodied in sixpence, and the value of a day’s labour-power be five shillings, the labourer must work 10 hours a day, in order to replace the value paid by capital for his labour-power, or to produce an equivalent for the value of his daily necessary means of subsistence. Given the value of these means of subsistence, the value of his labour-power is given;1and given the value of his labour-power, the duration of his necessary labour-time is given. The duration of the surplus labour, however, is arrived at, by subtracting the necessary labour-time from the total working day. Ten hours subtracted from twelve, leave two, and it is not easy to see, how, under the given conditions, the surplus labour can possibly be prolonged beyond two hours. No doubt, the capitalist can, instead of five shillings, pay the labourer four shillings and sixpence or even less. For the reproduction of this value of four shillings and sixpence, nine hours’ labour-time would suffice; and consequently three hours of surplus labour, instead of two, would accrue to the capitalist, and the surplus-value would rise from one shilling to eighteen-pence. This result, however, would be obtained only by lowering the wages of the labourer below the value of his labour-power. With the four shillings and sixpence which he produces in nine hours, he commands one-tenth less of the necessaries of life than before, and consequently the proper reproduction of his labour-power is crippled. The surplus labour would in this case by prolonged only by an overstepping of its normal limits; its domain would be extended only by a usurpation of part of the domain of
necessary labour-time. Despite the important part which this method plays in actual practice, we are excluded from considering it in this place, by our assumption, that all commodities, including labour-power, are bought and sold at their full value.

Granted this, it follows that the labour-time necessary for the production of labour-power, or for the reproduction of its value, cannot be lessened by a fall in the labourer’s wages below the value of his labour-power, but only by a fall in this value itself. Given the length of the working day, the prolongation of the surplus labour must of necessity originate in the curtailment of the necessary labour-time; the latter cannot arise from the former. In the example we have taken, it is necessary that the value of labour-power should actually fall by one-tenth, in order that the necessary labour-time may be diminished by one-tenth, i.e., from ten hours to nine, and in order that the surplus labour may consequently be prolonged from two hours to three.

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