Ask Lemmygrad

You don't need to add debt, or even money into the equation to complicate it. Lets use labor time (in hours) as our unit of account.

LH = composite labor hours (the labor hours required to harvest / produce the intermediate thing)

Input | Labor Hours

|

Wood for chair, IE materials | 1 LH Per chair cost of building factory, maintenance, other costs, etc | 1 LH Time to produce the chair (turn wood into chair), IE Wages | 1 LH | Capitalist sells the chair / Selling price | 5 LH

Surplus value = 5 LH - 3 LH = 2 LH

So the capitalist gains 2 LH for doing nothing.

Maintenance, startup costs, materials, can all be accounted for in the selling price. The point is that :

• Workers do not receive the full selling price (after accounting for other costs), and
• Workers do not control the surplus, IE its capitalist-controlled surplus value. This is the theft / profit part.

Unsolicited trivia: there’s a symbol for generic/unspecified currency: ¤

Constant Capital 20 money for machines/tools and raw materials + Variable Capital 10 money for the Worker. That 10 money is enough to feed, etc him/his family for one day. The Price of Work is not the same as how much Value he adds. The Worker adds more value than 10 money in a Day, lets say he can produce 20 money value per Day. So he could just work half a day and feed his family. But the Capitalist needs to make a profit so he lets the Worker work for the entire Day, but only pays him 10 money. So the Capitalist invests 20 + 10 money and get 40 money out by selling the Commodity.

His embedded productive capacity means he can buy wood for 2 (money) and then make the worker use his machinery and logistics create 20 (money) of value. He pays the worker 10 (money), pays his 2 (money) in costs, and pockets 8 (money) in profit.

This is also why the tendency is for the rate of profit to fall. The capitalist is always investing to increase production and reduce raw resource costs, but this inevitably leads to a massive amount of value tied up in their production and labor. Build a bigger factory to process more wood and chairs, now there's a larger factory to upkeep and more workers to pay etc.

It boils down to:

Profit = Sell price - Labour cost - Raw resources cost (which in turn also have labour cost involved...) - other production cost (electricity, water, etc).

To answer your question, the sell price of a commodity has to cover the costs required to produce it. e.g. a coat sold at $30 means it costed < $30 to produce in order to turn a profit.

Another important point is that commodities have to be sold/exchanged to turn profit, they do not inherently produce a profit. Big part of why marketing is really important nowadays, many commodities produced are completely useless i.e. they do not have any use-value, so in order to sell them they have to manufacture some use-value e.g. the "status symbol" from watches.

so wait, lets view it form a different perspective: Tools costs, Resource/ Material costs and the Wage the Capitalist has to pay the worker so he can survive to work further are all Costs which the Capitalist bails out by surplus-value by letting the same workers work for more than the wage they are paid indicates....until the value extracted by the capitalists is enough to pay back the production costs and to keep a rest of profit fort themselves.

Is that right?