Carefully examining the formula of capital, it can be noted in the last analysis that the matter of the accrual of capital is resolved in the following way: finding a commodity that profits more than what it costs; finding a commodity that, in our hands, can give rise to value, so that, by selling it, we come to amass more money than we spent to buy it. In short, it must be an elastic commodity that, stretched however much in our hands, can grow in value. This very singular commodity indeed exists and it is called labor power, or labor force.

For example, here is a money-owner, who possesses a large amount of wealth, and wants to use his wealth to give rise to capital. He comes into the marketplace solely in search of labor power. Let’s follow his process. He walks around the marketplace, and meet a proletarian, who came solely to sell their only commodity: labor power. The worker, however, is not selling his labor power in whole, not completely, but only partly, for a given time, ie for a day, for a week, for a month, etc. If he sold it altogether, of course, he would become a commodity himself; he would no longer be a wage-worker, but the slave of his owner.

The price of labor power is calculated in the following way. One takes the cost of food, daily life, rent, and however many other things are needed every year by a worker to maintain their labor power, always in their normal state; one adds, to this first amount, the amount needed every year by a worker to procreate, raise, and educate, according to their condition, their children; one divides the total by 365, the number of days in a year, and one will have how much, every day, is required to maintain labor power, one’s daily price, that is the daily wages of the worker.

A part of this calculation is also that which is needed for the worker to procreate, raise, and educate his children because these are the future sources of labor power. If the proletarian sold all of his labor power, instead of just a part, of course, he would become a commodity himself, i.e. a slave of his owner, and his children would also be a commodity, i.e. slaves, just like their parent, of their owner; but, by taking only a part of the labor power of the proletarian away, he has the right to keep the rest, which is found partially in himself and partially in his children.

With this calculation we obtain the exact price of labor power. The law of exchange, explained in the previous chapter, says that a commodity cannot be exchanged with another if the labor that is needed to produce the former is not equal to the labor that is needed to produce the latter. Now, the labor that is needed to produce labor power is equal to the labor needed to produce the things needed by the worker, and as a consequence the value of those things necessary to the worker is equal to the value of their labor power. Therefore if the worker needs 3 lire every day for all of their necessities, it’s clear that 3 lire will be the price of their labor power every day.

Now let’s suppose — a supposition never hurt anyone — that the daily wages of a worker, found in the above manner, amount to 3 lire. Let’s also suppose that, in 6 hours of work, one can produce 15 grams of silver, which is equivalent to 3 lire. The money-owner has meanwhile formed a contract with the proletarian, paying him for his labor power at the correct price of 3 lire a day. He’s a perfectly honest and religious member of the bourgeoisie, for whom it may look good to defraud the worker’s wages. He will be able to make the point that the salary is paid to the worker at the end of the day or the end of the week, that is after he has already completed his labor; because this is also how it’s done with other commodities, whose value is realized in use, like, for example, the rent for a house, or a small farm, whose price one is able to pay at the expiring of terms.

There are three elements of the labor process: firstly, labor power; secondly, raw materials; and thirdly, the means of production. Our money-owner, after the labor power, also bought raw materials at the market, namely cotton wool; the means of production, namely the workshop with all of its tools, is good and ready; and, consequently, he has nothing left to do than to make the way clear between his legs for the work to begin.

“[W]e think we can perceive a change in the physiognomy of our dramatis personae. He, who before was the money-owner, now strides in front as capitalist; the possessor of labor-power follows as his laborer. The one with an air of importance, smirking, intent on business; the other, timid and holding back, like one who is bringing his own hide to market and has nothing to expect but — a hiding” (Marx, Capital, vol. 1, ch. 6).

Our characters arrive at the workshop, where the boss hurries to put his worker to task, giving him 10 kilos of cotton wool, since he is a cotton spinner.

Labor is made up of the utilization of the elements that compose it; the utilization of labor power, raw materials, and means of production. The utilization of the means of production is calculated in the following way. From the sum of the value of all the means of production, the building, radiators, coal, etc, one subtracts the sum of the value of all of the raw materials that will remain of the means of production put out by the consumption of use; one divides the result of this subtraction by the number of days that the means of production can last, and one will have the daily consumption of the means of production. Our worker works a 12-hour day. When it’s over, he has transformed the 10 kilos of cotton wool into 10 kilos of thread, which he hands over to his boss, and he leaves the workshop to shrink at home. Along the way, however, for that ugly vice that workers have, to always want to reckon behind the backs of their boss, he tries to find out in his mind how much his boss will be able to earn off of those 10 kilos of thread.

“I don’t rightly know how much the thread costs,” he says to himself, but the amount is soon figured out. “I saw cotton wool when he bought it at the market at 3 lire per kilo. All of the means of production cost 4 lire per day. Therefore:

“10 kilos of cotton wool: ₤30

“Utilization of the means of production: ₤4

“Daily salary: ₤3

“Total: ₤37

“The 10 kilos of thread are worth 37 lire. Now on the cotton wool he certainly didn’t gain anything, because he paid for it at the proper price, neither a cent too much nor a cent too little; as for me, he pays for my labor power 3 lire a day, the price that suits him; therefore it must be the case that he profits by selling his thread for more than it’s worth. It absolutely must be this way; otherwise he would be spending 37 lire just to earn 37 lire, not counting the time that he lost and the inconvenience that it took.

“Now look how the bosses do things! They have a good wish to make out like honest people with the worker from whom they buy labor power, with the merchant from whom they buy raw materials, but they have an eternal flaw, and the rest of us workers, who know how the industry works, shall go on strike. But to sell a commodity for more than it is worth is like selling with false weights, which is illegal. Therefore, if the workers were to expose their bosses’ tricks, they would be forced to close their factories; and to produce goods based on need, maybe they would open large government facilities; that would be much better.”

So the daydreaming worker arrived at home; and there, dined, went to bed, and slept deeply, dreaming of the disappearance of bosses and the creation of government workshops.

Sleep, poor friend, sleep in peace, while hope still rests within you. Sleep in peace, for the disappointing day will soon come. Soon you will learn how your boss can sell their goods for profit, without defrauding anyone. He will make you see how one becomes a capitalist, and a large capitalist, while remaining perfectly honest.

Now your dreams will never again be so peaceful. You will see capital in your nights, like a nightmare, that presses you and threatens to crush you. With terrified eyes you will see it get fatter, like a monster with one hundred proboscises that feverishly search the pores of your body to suck your blood. And finally you will learn to assume its boundless and gigantic proportions, its appearance dark and terrible, with eyes and mouth of fire, morphing its suckers into enormous hopeful trumpets, within which you’ll see thousands of human beings disappear: men, women, children. Down your face will trickle the sweat of death, because your time, and that of your wife and your children will soon arrive. And your final moan will be drowned out by the happy sneering of the monster, glad with your state, so much richer, so much more inhumane.

Let’s return to our money-owner. This bourgeois, a model of accuracy and of order, has adjusted all of his daily counts; and here is how he has figured the price of his 10 kilos of thread:

For 10 kilos of cotton wool at 3 lire per kilo – ₤30

For the utilization of the means of production – ₤4

But around the third element, fitting into the production of his commodity, he has not noted the salary paid to the worker. He knows very well that a large difference occurs between the price of labor and the product of labor power. A daily salary represents how much is needed to sustain the worker for 24 hours, but it doesn’t by any means represent what the worker produces in one day of work.

Our money-owner knows very well that the 3 lire of salary he paid paid represent the upkeep for 24 hours for his worker, but not that which he produced in the 12 hours that he worked in his factory. He knows all of this, precisely as a farmer knows the difference that occurs between what it costs to maintain a cow in a stable, to feed it, etc, and what is produced in milk, cheese, butter, etc. Labor power has the singular quality to give something more worth than it cost and it is for this exactly this fact that the money-owner went to purchase it in the marketplace.

The worker has nothing to smile about. He took the fair price for his good; the law of exchanges was observed perfectly; and he doesn’t have the right to tell the buyer what to do with the commodity, like how a grocer can’t tell their patron how to use the sugar and pepper bought in their shop.

We have supposed above that, in 6 hours of work, 15 grams of silver are produced, equivalent to 3 lire. Therefore, if in 6 hours the labor power produces a value of 3 lire, in 12 hours it will produce a value of 6 lire. Here therefore is the calculation, which states the value of 10 kilos of thread:

10 kilos of cotton wool at 3 lire per kilo: ₤30

Use of the means of production: ₤4

12 hours of labor power: ₤6

Total: ₤40

The money-owner has therefore spent 37 lire and has obtained a commodity that is worth 40 lire; so he gained 3 lire; his money has increased.

The problem is unraveled. Capital is born.