(3.ii.30) Make now a different supposition: that the machine is an article of fixed capital,and not worn out, and let us trace the consequences. It was correctly supposed, in the former case, that100 days' labour were expended by wearing out the machine; but 100 days' labour have not beenexpended in the second, because the machine is not worn out. Some labour, however, has beenexpended, because 100 days' labour in a mass has been applied. How much of it shall we say hasbeen expended? We have an exact measure of it in the equivalent which is paid. If the equivalentwhich was obtained when the machine was worn out, was a measure of 100 days' labour,whatever proportion of such equivalent is received as a year's use of the machine when not wornout, must represent a corresponding proportion of the labour expended upon the machine.
(3.ii.31) Capital is allowed to be correctly described under the title of hoarded Labour. Aportion of capital produced by 100 days' labour, is 100 days' hoarded labour. But the whole of the 100days' hoarded labour is not expended, when the article constituting the capital is not worn out. Apart is expended, and what part? Of this we have no direct, we have only an indirect measure. Ifcapital, paid for by an annuity, is paid for at the rate of 10 per cent, one-tenth of the boardedlabour may be correctly considered as expended in one year.
(3.ii.32) The instance which is commonly adduced as exemplifying the supposed fact of anincrease of value without increase of labour, is that of wine. Wine acquires a greater value bybeing merely deposited in the cellars of the merchant.
(3.ii.33) But they who would advance this, as an answer to the antecedent reasoning, do notperceive the force of their own objection. Their doctrine is, that exchangeable value is regulatedby cost of production. Cost of production is the outlay necessary for completing the product.
When the wine was put into the cellar, it was worth so much, according to the capital expendedin its production. When it is placed in the cellar, no more capital is employed upon it, nor anymore labour; and yet it acquires an additional value. The question, why it acquires more value,when there is not more capital, is just as difficult, as why it acquires more value, when there isnot more labour.
(3.ii.34) It is no solution to say, that profits must be paid; because this only brings us to thequestion, why must profits be paid? To this there is no answer but one, that they are theremuneration for labour; labour not applied immediately to the commodity in question, butapplied to it through the medium of other commodities, the produce of labour. Thus a man has amachine, the produce of 100 days' labour. In applying it, the owner undoubtedly applies labour,though in a secondary sense, by applying that which could not-have been had but through themedium of labour. This machine, let us suppose, is calculated to last exactly 10 years. One tenthof the fruits of 100 days' labour is thus expended every year; which is the same thing in the viewof cost and value, as saying that 10 days' labour have been expended. The owner is to be paid forthe 100 days' labour which the machine costs him, at the rate of so much per annum, that is, byan annuity for ten years, equivalent to the original value of the machine. It thus appears thatprofits are simply remuneration for labour. They may, indeed, without doing any violence tolanguage, hardly even by a metaphor, be denominated wages: the wages of that labour which isapplied, not immediately by the hand, but mediately, by the instruments which the hand hasproduced. And if you may measure the amount of immediate labour by the amount of wages,you may measure the amount of secondary labour by that of the return to the capitalist. Wesurely have not occasion to add, that if this be the general account of profits, which seemsundeniable, it is applicable to all particular cases, to that of wine in the cellar, as well as to everyother. Suppose that 100 men make a machine in one day, that another 100 men employ thismachine the next day, and wear it out; the first 100 men, and the second 100 men, will divide theproduce equally between them. The share of the first 100 men is payment for capital, no doubt,but it is also, most obviously, payment for labour too; and in whatever degree labour isproductive, that is, yields more than is consumed in effecting the product, to that degree anadvantage is afforded beyond the replacing of the capital consumed, and constitutes profit.
(3.ii.35) The return which is made to capital employed upon the land, is that whichdetermines the rate of annual profit from all other employments of capital; and, of course, for that which isemployed in meliorating wine in a wine-cellar. The case of the wine in the cellar coincidesexactly with that of a machine worn out in a year, which works by itself without additionallabour. The new wine, which is one machine, is replaced by its produce, the old wine, with thataddition of value which corresponds with the return to capital employed upon the land; and theaccount which is to be rendered of the one return, is also the true account of the other.
Section III. Effect Upon Exchangeable Values of a Fluctuationin Wages and Profits.
(3.iii.1) In stating that commodities are produced by two instruments, Labour and Capital, ofwhich the last is the result of labour we, in effect, mean, that commodities are produced by twoquantities of labour, differently circumstanced; the one, immediate, or primary labour, thatwhich is applied at once by the hand of the labourer; the other, hoarded, or secondary labour,that which is the result of former labour, and either is applied in aid of the immediate labour, oris the subject matter upon which it is bestowed.
