Addendum to Competition of Capitalists and Preview of Wage Labor
On the “necessarily false consciousness” found in the “character masks” of the capitalist mode of production

“Thus everything appears reversed in competition. The final pattern of economic relations as seen on the surface, in their real existence and consequently in the conceptions by which the bearers and agents of these relations seek to understand them, is very much different from, and indeed quite the reverse of, their inner but concealed essential pattern and the conception corresponding to it.” (Karl Marx, Capital Vol. 3, International Publishers, p. 209)

Marx claims that those who actively shape capitalist competition and those who go along with it have a necessarily false consciousness. Not of this or that, or of all kinds of things — it would be hard to find any necessity for that — but of the necessities that quite generally and unshakably govern people’s material existence in this world: earning money and making a living with it. In other words, a distorted perception of the universal constraint that everyone knows, has to reckon with and cope with in practical terms.

There are in fact plenty of misconceptions circulating about this, especially about the difficulties and opportunities involved in accomplishing this life task. But every halfway practical person knows this much about reality: you need money to live and there are basically two ways to get it. You either earn it from an employer who has an interest in the work you are willing to do and money to spare for it. Or you have enough surplus money, from somewhere or other, to invest it profitably, as an employer in your own company or as a loan for interest or some similar return. It is also widely known and perceived as reality that opposing interests are regularly aimed at the same sum of money: employers and employees compete over the price of the work to be paid for; consequently, companies sometimes compete for suitable workers while employees very often compete for a job; the minority living on interest income join in on the employers’ side with a focus on returns. This is not always pleasant; representatives of the competing parties make life even more difficult for each other by quarreling over corrections in the opposite direction; and they offer ideological justifications for their position that are not just considered wrong by the opposing side, they are actual distortions shaped by personal interest. But what it really comes down to is, at bottom, always clear: each side fixates on its source of income and fights for what it yields using the other side's dependence as leverage. So far, so good — or bad. But what is reversed here? Where is false consciousness at work? Especially necessarily false — what kind of necessity is there?

How it is false

It is no special insight, in any case not an especially difficult one, that counting on one’s own source of income does not really work out for the vast majority of money-earners, and that is no accident. Their income makes them dependent on the labor needs of the other side. Just to get a job to provide them with any pay at all, they must undergo a comparison that an employer determines according to his needs and makes among a great number of applicants — or stops making by eliminating the job altogether. For it is his benefit, measured in money earned or saved, that is the prerequisite for job seekers and employees to gain an income. This already makes it clear that the income of employees is not based on their needs, will always be meager in relation to what they need to live (exceptions to the rule don’t improve matters), and, consequently, the sphere of individual freedom is basically ruled by the pressure to critically manage one’s means. So they must not only perform the paid work but also repeatedly fight for better working conditions, but especially against them being worsened insidiously or blatantly — a particularly clear indication that work cannot be considered an available, proper source of income for employees. There is no doubt that they have come to terms with this situation by and large; not merely in a passive way, but by trying more or less persistently to make the best of their dual competition — against the employer and against each other. That comes pretty close to admitting that what they are deploying as their economic means is not their means at all. But what is it then?

Formally, according to the calculations of both sides, wages are payment for work performed as agreed. But what does "work" actually mean in this context? What it involves is entirely up to the employer (a term not used by chance). The employer’s requirements must be fulfilled by the (logically termed) employee, who must adapt and submit to them. Just as the true economic essence of such work does not lie in the employee’s manual, mental, or nervous exertions, its true economic result does not lie in its material product, the produced good or service. Rather, it lies in the employer turning this product into money belonging to him. And what does "paid" actually mean in this context? The purpose of the whole exercise is to achieve a favorable relation for the employer between the sum he pays for production and the sum he receives from sales. In terms of their economic purpose and real essence, wages are the price the employer must pay to have complete and unrestricted control over his employees’ labor and the sales revenue. The economic truth about labor as a source of income is that the employer has the power of disposal over labor-power as a means for increasing money. On the one hand, this does not alter the fact that employees are free people who can choose what to do with themselves — that is, with their abilities and their time — and who make these things available to their employer out of necessity but also out of calculation, in exchange for money. And that is reason enough for them to have a consciousness of being their own source of income themselves, willingly and consciously, something that is confirmed as self-evident by the social consensus, with a few limiting conditions but in principle. On the other hand, this is nevertheless not the truth. If there is no employer to benefit, no work will be done (needless to say, this also applies to the public sector); work in itself, as an activity that is useful in some material way, is economically worthless; it can only turn into money if it is the money-equivalent property of the employer, not of the person who has performed it. So the consciousness of their work that employees have is definitely quite false; and it is not an individual misconception either, but rather common knowledge, and recognized in principle by academics as well. But does that make it necessary? And if so, in what sense?

For the other side, the employers and business people in possession of plenty of monetary assets, counting on their property as a source of money basically works out quite well; exceptions prove the rule. However, they, too, have more than enough reasons and occasions to be critical of their fine situation. To be sure, their wealth grants them considerable freedom and power to lay hold of anything money can buy — and what can money not buy in the modern world? But using this wealth as a source of money means inevitably entering into dependencies that are beyond their control: conditions on the markets — for purchasing, selling, credit, and even labor — where they, but also countless competitors, are active. Consequently, they lament the constant challenge of managing these conditions, again and again, every day anew. They pay money, quite good money in fact, to have this taken care of by staff of their own or by consulting firms, which are in turn dependent on the volatility of orders and their success record that is even shakier to calculate. To support them there are two complex disciplines, business administration and economics, which are devoted to identifying and explaining a bewildering array of determining factors influencing both general and specific economic activity, and can even quantify their impact; much like the natural sciences, which investigate objective determining relationships and their measurable initial conditions in order to derive technologies that allow these relationships to be used for one’s own purposes vis-à-vis the natural world. Similarly, or at least with the same intention, economists and consulting institutes develop forecasts about expected processes and interconnections, and derive recipes for making economic-policy and corporate decisions that aim to be of maximum practical relevance. The tips they give capitalists for their competitive fights are given out as objectively sound guidelines, but cannot work as such if only because they are always given to all the competitors and supposed to help them succeed as well. At best, they systematize the calculating common sense that business operators already have. For those with political responsibility, they offer predictions that are realistic insofar as they are constantly being adapted, preferably “in real time,” to realities that change in their own way, going against the forecasts not least because the powerful shapers of economic events adhere to the experts’ recommendations as if they were technical instructions. Thus these disciplines, on balance, provide a special kind of proof for what is already common knowledge: that the good fortune of capitalists — both employers and financiers — to be able to live well from skillfully applying their wealth depends on a multitude of circumstances that, on the one hand, act like given natural conditions working according to their own inherent logic and, on the other hand, reveal no real determining relationship and therefore defy being dealt with on the model of a knowledge-based technology. At the same time, this entire academic superstructure implemented by clever think tanks testifies to the unwavering belief — by no means only among professional market-economy ideologues — that using great monetary assets as a profit- or interest-yielding source of income is ultimately based on an exploitable law, and thus on practical rationality. The practitioners themselves, at least as long as they are successful, consider themselves the masters of economic independence anyway, those at the very top of the capitalist hierarchy calling themselves “Masters of the Universe” with self-ironic modesty. And when profits fail to materialize, portfolios shrink instead of grow, and the money spent to earn more is simply gone, they complain that there has been an improper disruption, their right to returns has been violated and trampled on. So there is plenty of false consciousness among the elite as well. And here, too, it is far more than a generalized sociocultural mistake that could be corrected by a clear look at the real situation. But again: is it necessary? And if so, how?

How it is necessary

The fact is that earning money — whether by selling one’s working ability and time or by applying one’s money assets — is the prime means of subsistence for people in the world of capitalist competition; not by mistake, but as a concrete practical reality. Work or money is their means; either because they have no other (in the former case), or because they have enough of it (in the latter). And not only that: by earning their living in this way, they re-produce themselves or their money as their source of income, and thus their dependence on the necessity — or opportunity — of earning their money in this way. The fact is also that when people act in this way, their practical experience shows that money and the efforts to earn it are not the expediently created and ingeniously reproduced means for them to make a living: paid labor regularly proves to be the source of inevitable harm, varying only in degree, a sacrifice of body, mind, and time. Freely using money as capital entangles the fortunately wealthy in a web of constraints that are basically beyond their control. The end and the means contradict each other. This sort of thing happens constantly when people deal in a calculating way with nature, both their own and that outside them. But such contradictions have a basis that is in principle easy to recognize: a cause-and-effect relationship that obeys laws of nature, and has either not yet been — sufficiently — adapted to the purpose being pursued or cannot be made to serve it at all. With money and the necessities of earning it, however, people themselves create and reproduce their crucial means of economic survival, which nevertheless acts like an uncontrolled natural condition; a means that governs their calculations and actions, rather than them governing it.

This contradiction is not grounded in, not necessitated by, people's misguided thinking but rather the matter they grapple with: the economic nature of their indispensable means of subsistence, the kind of societal wealth that employers and employees produce using their respective sources of income.^[1] For this wealth involves two contradictions. Things are produced that have a use-value; that is what society lives on after all — this much is obvious. But in the society that actually exists, with its capitalistic production, it is equally taken for granted that a useful product does not count as wealth in terms of its use-value, its material utility, but in terms of its price, which comes between, and separates, the use-value and the private or public need it satisfies. The sum of money to be paid for a useful product thus grants access to it — as to all equivalent commodities. The economic actors do not need to know what causes incommensurably different use-values to be equivalent, with this equivalence existing in money as a separate economic object. They simply deal with it according to their purposes; but with what, exactly? The answer leads to a fundamental mix-up. What makes the products measured against each another in trade alike, commensurate with each other, is that they are just that: useful products quite generally, elements of societal wealth, i.e., wealth created through society’s division of labor, results of society's labor. Their equivalence is based on, and expresses, the fact that they contain equal fractions of the societal labor expended; an expenditure that is not determined by the endless variety of incommensurably different productive sub-tasks, but, abstracting from that, solely by what they all have in common: their duration. The time economy that governs the capitalistic and indeed every mode of production manifests itself here in its results, that is, in their being systematically traded, as an exchange-value. This is a mix-up that culminates in the equivalence of time units of productive labor taking on an independent, objectified form, existing in one product (money) whose use-value — ultimately only — consists in this function of representing quantities of socially expended labor time. That is the objective, real contradiction in the nature of capitalistically produced wealth: money, which everything revolves around earning, represents the societal expenditure of labor in such a way that it realizes it in the perpetual process of buying and selling, while at the same time making it unrecognizable theoretically and actually removing it from any rational planning in practice.^[2]

This, however, is only the negative side of what money accomplishes in place of any conscious planning of societal labor: it is the actual purpose of this labor. Not in the trivial sense that is obvious to everyone, i.e., as a means to get a share of the wealth produced. Being the universal equivalent that connects buying and selling, thereby realizing the connection of the societal division of labor in an irrational way, money is the unconditional condition and regulating principle of production. This manifests itself, when it is used as sales proceeds and a means of purchase, in such a way that it does not disappear from trade like the consumer goods bought and sold, but is preserved in and through the exchange of goods that it mediates. It stands at the beginning and at the end of trade. Its relation to societal labor, whose connection it brings about, is that of being its starting point and its end point, and thus its objective purpose, the purpose stipulated for the production of goods. As its purpose, money is no longer only the means that mediates the ups and downs of goods production: through commodity trade, it appropriates goods production for itself; not merely to reproduce itself, but for itself as the only product that really counts, as the epitome of societal wealth; thus, for the purpose inherent in this wealth: to increase. However, this purpose, enrichment through increased money, cannot be realized by trading equivalent goods and using money as the universal equivalent. Commodity trade, which gives the prevailing economy its name of "market economy," explicitly refers back to the societal labor that has been made use of. Under the regime of money as an end in itself, labor appears in two forms: as the purchasable potential to produce exchange-value, i.e., money, and as an actively utilized source of money. Or, conversely, as a quantity of labor time that presents itself as exchange-value, i.e., creates money, and as a quantity of labor power that can be acquired for wages as a commodity with the specific use-value of creating exchange-value. The economic truth of money is thus its power of disposal over the source of its creation, realized in its self-increase which in itself knows no measure or limit. As capital, whose sole determination is accumulation, it is the imperative purpose of societal labor, a purpose created by humans themselves, but given prior to all subjective calculation, like an unexplained natural condition.

How is it consciousness

“So as to impose the inherent laws of capital upon it as external necessity, competition seemingly turns all of them over. Inverts them.” (Karl Marx, Grundrisse / Foundations of the Critique of Political Economy, Vintage Books, p. 761)

The agents of this purpose are money owners, who make their property, as capital, the means for their personal enrichment. The reason why this kind of enrichment exists — as a profession even, which can be practiced by anyone who has nothing more, but also nothing less, than a great deal of money going beyond their personal needs — is not these people, not their skill in putting their money to capitalistic use. Their job would not exist if the regime of money over societal labor were not already objectively embedded in the mercantile sphere, which used it, and still does, to do nothing but trade finished goods. From there, all that was needed to progress to a rule over labor’s potential to create money was the deployment of large sums of money for appropriating society’s means of production and, on the other side, a majority of free, propertyless people faced with money as just that: the price for having command of their labor power and time. And all that was needed to create the vocation of wage laborer was for money’s function to develop into capital to represent societal labor as a commodity value and at the same time instrumentalize it for increasing itself. Wage laborers came about simply by the plight of being without property making people willing to let themselves be instrumentalized that way. Neither the capitalists nor the wage laborers actually instigate the capitalist mode of production, even if they de facto carry it out — there is no one else to do it. Their jobs mean that the former make their fortune, and the latter reproduce their service and the harm it does them, as character masks of their functions, as Marx called it.

In the three volumes of Capital, Marx derives the entire system of capitalism’s necessities from the elementary principles of money. In each case he shows how these systemic necessities are turned into plausible factual constraints framing the way the members of the social classes consciously calculate their economic actions. The whole thing boils down to the conclusion that the system of surplus-value production assigns people their function within it — capital, wage labor, and land ownership — as their source of income, and they compete within these classes and against the others for what their source of income yields — profit or in its pure form interest, wages, and ground rent. And the societal wealth that is reproduced in an increasing amount, and factually distributed over these sources of income according to the laws of how it comes about, appears as the sum of what the three income-earning classes separately “produce,” who thus seem to be receiving what they contribute. This upside-down practical and theoretical stance that the members of class society have toward societal wealth in its monetary form, whose contradiction was the starting point for explaining the mode of production, is the necessary endpoint.^[3] This explanation has revealed that the world of equivalent exchange where people, following its rules, try to earn their living with varying degrees of success, is a system of exploitation; there is definitely no question in this respect. Reading the same equation in reverse, the exploitation of labor — that is, of those who perform it — by and for the power of money according to its capitalist truth is not a matter of deliberate oppression, of systematically negating the self-interest of those exploited, as with the slaves in the genesis of capitalism in the United States. Instead, it is a matter of the workers’ self-interest being instrumentalized by the means of free money-earning imposed on them, as fully developed US capitalism so exemplarily shows.

In Practice: The World of Competition

“Competition is … the way capital establishes its mode of production." (Karl Marx)^[*]

This contradiction of instrumentalized self-interest, instrumentalized for the end-in-itself of capital accumulation that dominates the economy, and realized in the competition for returns from the use of money, wage labor, or land ownership as a source of income, is a separate subject.^[4] The principle of it is simple. In all three cases, the actors take a most consistent affirmative position on their source of revenue as their vested possession, and answer every practical difficulty they inevitably encounter by stepping up their particular efforts — in a way they teach each other in their competition.

Accordingly, for people with enough money — referring here not to stereotypes, but to the logic of a career as the character mask of a money accumulation that takes itself as its only measure — their job as a capitalist starts with spending their money in order that it return to them in a greater quantity; this is to happen constantly and as often as possible, i.e., in a cycle of buying and selling that is optimized for speed. If they are bringing about the difference in value between advance and return by a production process under their control, as employers, they proceed on the assumption that the productive power of the labor to be paid for, especially with regard to the surplus to be achieved, can be bought on the markets and developed for money, so is in any case and definitely the work of their advance against the expected return, and thus entirely up to them. Their efforts to achieve continuous and optimal returns, as far as the company they own is concerned, focus mainly on shortening the production time, something the workforce has to achieve. They are also interested in shortening the duration of buying and selling, the time their assets are outside their operations and their direct control. This alone is reason enough for commodity traders and money dealers, as special types of capitalist — both venerable professions are offered a vast, new field of activity in fully developed capitalism — to shorten the time until the producing capitalists are liquid again and can go back into action. Particularly the longstanding achievement of commercial credit proves very useful here. At the same time, it is a given from the outset that their competition for goods and prices clearly shows that market activity is a battleground of conflicting interests, where the separation of needs from their objects that is quantified in prices, and the private power to take possession that is objectified in money, reveal that they are a matter of force. A peaceful handling of the available sources of income requires supervision by a higher, general power. Thus, the competition of capitalists involves a separate subject requiring explanation — the state — as the monopolist on the use of force that makes and enforces laws, and subsequently takes on responsibility for the success of this competition in more and more respects. This goes so far that political rule, as the necessary condition for the productive power of national capitalism and the cooperation of the social classes, asserts itself and the enforcement of its monopoly on the use of force abroad as well, as its overriding political purpose. Escalation of the competition of capitalists in a mutually critical symbiosis with political rule culminates in the imperialism of the most powerful states opening up and instrumentalizing the world for the global success of their capitalists, for unbridled economic growth, for the global validity of their particular national money, and, as the basis for business, for the dominance of their weapons.

For the vast majority of people without money, the contradiction of self-interest being instrumentalized for the end-in-itself of capital accumulation plays out in such a way that they must first find an employer interested in them as useful labor-power. What they can offer of their own accord already compromises the purpose they are going to work for: just as everyone knows from experience. The conclusions Marx drew from this furthermore show that this paradox is inherent to the logic of the mode of production, and therefore cannot be abolished within the world of capital. What remains for those affected to do — apart from revolutionizing this world — is to decide to make the best of their dependence and built-in poverty. Complementarily to the logic of capitalist competition with its inherently necessary stages of escalation, this consistently leads to the career of a wage laborer’s life. The struggle to resolve the contradiction between end and means takes it to the next level: first, longer working hours, meaning more sacrifice of free time; then, greater effort, meaning more wear and tear for more money that cannot compensate for the increased exertion. In any case, not a good trade, and one that wage-dependent people do not even have any control over. Even for that they are dependent on what employers have to offer, which is by its nature the “generous” side of optimized utilization. These contradictions are consistently continued by a transition to collective demands and collective resistance, a point of contention because, firstly, this itself costs money and effort, and secondly, it contradicts the competitive point of view, which is likewise part of the logic of actively practiced wage dependency, and is therefore not a character flaw among those equally harmed, but rather a characteristic of their existence as character masks. In the world of wage dependency, solidarity among those affected reproduces the harm they are collectively fighting against, in that trade union representation influences the modalities of earning money so as to affirm and help organize its continuation, including the need for ever-new collective efforts to make corrections. State power constantly plays a crucial role in this continuum of contradictions as well: empowering and restricting and always promoting the expedient instrumentalization of wage-dependent self-interest. The fact that the law together with social-welfare measures nail people down to this contradiction inherent in their source of income appears, quite appropriately, upside down as protection. This again is not a mere illusion, but results from the necessarily upside-down way employees see their jobs. Their false consciousness of this always involves, not quite as necessarily, disappointed moral claims and some form of a patriotic sense of responsibility. In the end, the assertive imperialism of the capitalists and their political overseers is matched, on the side of the maneuverable masses, by the status and the standpoint of a politicized people.

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