The working class and the capitalist economy
5 February 2018
Ever since the publication by Karl Marx of his masterwork Das Kapital 150 years ago, bourgeois economists have sought to refute his labour theory of value, which disclosed the inner workings of the capitalist economy.
This theory demonstrated that the wealth accruing to the capitalist class, in its various forms as industrial profit, rent and gains from operations in a range of financial markets, was ultimately derived from the surplus value extracted from the working class through the wages system, the foundational social relation of capitalism.
In recent decades, the claims that Marx had been refuted were fuelled by what was called the rise of the “new economy,” in which wealth was generated by new technology and the seeming ability of money to simply beget more money in financial markets, in the absence of any form of value creation by labour.
Marx had, in fact, explained such phenomena in his analysis of what he called the “fetishism of commodities,” in which he showed how the very appearance of forms generated by the capitalist economy concealed and mystified its underlying social relations.
As has so often happened, just as Marx’s theory has been declared dead and buried for the thousandth time, a development in the capitalist economy has once again confirmed it.
The sudden sell-off on Wall Street last Friday, when the Dow Jones index fell by 666 points—the biggest drop in two years—was such an event. It came in the midst of a 40 percent rise in the Dow since the election of Donald Trump.
It was precipitated by a rise in interest rates on bond markets, with the yield on the benchmark US 10-year Treasury note rising to 2.85 percent, its highest level in four years. The rise in the Treasury yield…