surplus value where does it come from



I have money issues. Major money issues. But not how you would think. I don’t have debts, I don’t run up crazy credit card bills. No, I am actually scared of money. I hate it. I don’t mind spending it; in fact I quite enjoy that part, especially if I can see the face of the person I am buying stuff of, like at a shop, or a market. It brings a feeling of relief. Because actually having it sit there in my bank account just makes me feel uneasy.

That’s my parent’s fault of course. I remember the first time that Marx’ concept of “surplus value” was explained to me by my mum. It was bed time and I can’t have been older than eight. Ok I feel I am losing you here but bear with me, it features diamonds and tinned fish and stuff.

You know how at some point, all kids ask that question, at the latest when you are in some toy store, they want something and you don’t want to buy it, and at a loss as to what reason to give (it’s ugly, it’s crap, you’ll only play with it for five minutes) you say “I don’t have enough money.” The kid looks up at you as if you are a few cards short of a full deck and says “But why don’t you just go to the bank to get some more?” This question then inexorably leading on to “But where does money come from?” and “Why doesn’t the bank just print enough for everyone then?”

My mum was a pretty clued up kind of gal having known great wealth and also great poverty within the first 7 years of her little life (she had also spent 3 nights in prison before she hit the three-week mark but that’s another story) so didn’t do things by halves: she just jumped straight in and introduced me to Marx’ theory of surplus value.


She told me about the diamond miners in South Africa, and talked me through the whole product chain, the dirty raw diamond becoming shinier and prettier as it passed from black hand to increasingly whiter hand until it landed in Antwerp at the diamond centre of the world, and onward to adorn some elderly rich lady’s wattle (ok, I might have just added that detail myself).

The process of actually mining the diamonds and cleaning and selling them on brings a mere 0.4% of added value; in contrast, the retail end, the polishing and the cutting EACH add 25% of added value*. So broken down it means that the miner risking his life is getting paid a pittance, whilst the guys in Antwerp, even considering the skill involved, are getting paid a ridiculous amount. We could argue about which person in the chain contributes more added value, but let’s be honest: Without the guy going down that black hole risking his life, there IS no diamond to cut and polish.

But my favourite example of surplus value (which also doubled as a bedtime story: an example of two-for-one if ever there was one) was a very practical and visual tale of my own family history.


My mum was born the daughter of a rich industrialist in Czechoslovakia. A fish factory owner to put it baldly. I know. Go on, have a giggle. Yes, apparently there was money to be made in kippers. But not just normal fish fresh from the sea. That’s where the issue of surplus value comes in.

My great-great grandfather Anton Kalla figured out that it was cheaper to import raw fish from the Baltic Coast down to the ore mountains of Czechoslovakia where he lived, and then salt, smoke, and marinate it and then finally fill it into pretty tins. If he had done the canning in Germany where the fish was caught, the price of importing tinned goods was much higher, thus reducing the profit margin substantially. So, instead, he built a smokehouse, a cannery, a large factory with 400 workers. All those women standing in rows cutting gherkins and onions (300 tonnes of each a year!), pouring vinegar (200,000 litres a year). THEY were the adding value.



The factory tinned 1 million tins of fish a year and his house, set apart on a small hill, presiding over the whole village and factory was a manifestation of this surplus value.


To his defence he was apparently not a bad geezer, as capitalists go. He was what we like to call a benevolent capitalist, the kind that apologists of free market economy are always hoping will some how magically multiply, turning the world of rampant capitalism into a kind of Victorian idyll, with well-fed peasants walking round (barefoot but only in the summer) with baskets of flowers tugging their forelock as the capitalist lord, fair but strict, walks by.

Anyway, that was the sobering moment when I realised that money really doesn’t grow on trees. Someone somewhere is doing double the hard graft for half the pay, to create that surplus value. Someone is going without, so that someone else along the line can afford that extra side of wagyu tartare (ok I invented that, but admit it, it’s making you want some). So now, every time I pick up an object that screams “Reduced! Only £2!” or “Three for the price of one!” at me, I wonder in what part of the production chain that surplus value was created.

I get that someone who takes risks (financially and otherwise) to found a business, to employ people, someone who has great innovative ideas, deserves to be paid for it. I am not suggesting that the fish cutter should earn exactly the same as the guy doing the book-keeping. But why does the scale have to be tipped so drastically in favour of the cushy warm jobs where no physical risk is involved, no stink, no eye-watering onion cutting? Because the spectre of being an onion cutter myself is so completely unattractive, and my discomfort around money makes me a bit of a liability when it comes to paying bills and raising two kids, I have made a compromise: I allow myself to earn good money by exploiting only myself. Oh and then I go out and spend it all on Karl Marx biographies for my friends for Xmas. Yes, I am going to spread all that surplus value all over town.


So when I see the crazy pre-Xmas rush for presents, and all the advice doled out for “The Woman/Man who has Everything” (diamonds, or tinned fish anyone?) I wonder what kind of group hysteria we have managed to manoeuvre ourselves into as a society. You want to give me a present? (I know, you won’t want to after reading this!) Bake some cookies and be done with. My re-gifting present draw is already overflowing. (and let me know if you’re interested in a can of kippers or the Victorian cast iron nut cracker I have in there…)