Book Review: Michael Heinrich, “An Introduction to the Three Volumes of Marx’s Capital”

The first thing to note about the recently much discussed An Introduction to the Three Volumes of Marx’s Capital is that it is no such thing. What Michael Heinrich has done in this work is not give an introduction to the book for the new reader, but provide a critical summary of its contents seen from the point of view of the so-called ‘new critique’, also known as the ‘value-form’ analysis of Marxism. This particular analysis focuses, as Heinrich says in the introduction, on a particular interpretation of Marx’s value theory. This is not illegitimate: there are various major interpretations of Marx’s value theory, not least because of its complexity and opacity, and it makes sense for an author to be clear about his or her commitments to a particular one so that the reader knows what is going on. However, throughout the book the structure of the argument is more often than not polemical, explicitly or implicitly, against rival interpretations of Marx – both the attempts to make Marxism into a more general theory than Heinrich finds warranted, which he describes as “worldview Marxism” or “traditional Marxism”, and rival interpretations of Marx’s value theory specifically. While polemicizing, however, he declines to identify any of his opponents or opposing currents by name, making the exercise both fruitless as an effective counterargument – because a newbie would not know what it was a counterargument against – and as a contribution to the debate. Attacking opponents without naming them or explicitly citing their viewpoints is a dishonest strategy, but one sadly common in Marxist polemics, even about such seemingly abstract topics as value theory.(1)

The risk of such an approach is that it either agitates against straw opponents, making the author seem more convincing by arguing against views that his main interlocutors do not really hold, or that it creates any number of false dichotomies: making the author’s viewpoint seem strictly contrasting to those of others, when it is by no means certain that they cannot be compatible or reconciled. Heinrich does both of these to some extent. Now this may also follow somewhat from the generally philological style of argument that pervades the book, and is not a reflection on Heinrich’s ill intent or conscious deception. But it does further take away the purpose of the book as an ‘introduction’, rather suggesting it should be read more as a polemic in the form of a restatement or reinterpretation of Marx’s theories. That is of itself fair enough, and happens plenty; but it would be better to explicitly advertise it as such, certainly in a time when many are newly seeking out radical understandings of economic theory and may encounter this as a guide to Marx’s magnum opus, which it simply is not. Of course, with a work of this type, one can always find any number of expressions and formulations of issues that one would have written differently. Nitpicking such things is not helpful; I will therefore not mention all of the minor points of disagreement or different emphases I would have, but outline a few of the central issues.

That aside, this is not to say there is no merit in the work as a summary of Marxist views. On the contrary, the style is as clear and accessible as the abstract subject matter will allow, and much of the analysis of Marx’s main points is systematic and clearly argued. Oddly for a theorist emphasizing Marx’s interpretation of capitalism as ultimately being about the form of social relations that prevail in such a society, Heinrich is perhaps in his best form when analyzing the workings of money, credit, and the contrasting interpretations of neoclassical economics. His explanation of the nature of credit in the capitalist system and of money as the necessary form of appearance of value are very clear, as is his presentation of Marx’s critique of the foundations of neoclassical macroeconomics: the “trinity formula”, as Marx calls it, that identifies three ‘factors of production’ (land, labor, capital) and ‘awards’ each of them income in exchange for their share in the production process (rent, wages, profit).

Heinrich masterfully shows how this is the way capitalism appears in its most concrete form, as Marx fully developed in Volume III, and how this in turn generates and supports the fetishistic idea of capital as a force that has productive power of its own, independent of the labor that actually generates all new value. Similarly, Heinrich very clearly outlines why one cannot see the credit and debt system, interest, and financial capital as mere parasitical impositions or evil outgrowths of a normal capitalism: they are fundamental parts of capitalism as a mode of production from the very start, and capitalist accumulation can barely function without them. It is not a question of the evils of finance versus the good industrialists, or the ‘greed of the bankers’, or the social dependence created specifically by credit: it is a question of capitalism itself. In his systematic depiction of capitalism as subject to its own laws and generating its own mystifications, Heinrich excellently shows how one cannot ever have a capitalism that has its ‘good’ sides but not its bad sides.

Throughout, the emphasis on how the interpretation of capitalism’s workings is itself conditioned by the indirect and topsy-turvy mode in which it seems to be reproduced is very valuable. The fetishism of the commodities is not a question of false consciousness or of too much attachment to brands, but is the result of the independence of the competing capitals and the role of exchange as realizing the value relations central to capitalist reproduction. Heinrich keeps his eye constantly on the manifold ways in which capitalism’s social relations generate their own reified images, making them seem both natural and independent forces working through the mystical generating powers of capital and ‘entrepreneurship’, rather than being ultimately the variegated reflections and distributions of the value relations that are constantly reproduced in the sites of capitalist production.

Sometimes, in Heinrich’s emphasis on the significance of money as the independent form of value, he perhaps overemphasizes exchange somewhat. As Guglielmo Carchedi has pointed out in his critique of Heinrich, the process of exchange is a realization of what in capitalist production of commodities is potentially already present – value.(2) Yet one need not share Carchedi’s desire to put this in terms of ‘dialectics’, and this is perhaps something of a terminological quibble. More important is the notion of Heinrich that value itself exists in and through the exchange of commodities – this fails to distinguish conceptually between exchange value and value, as can be seen in Heinrich’s failure to really explain how some things aren’t reproducable as commodities and yet have a price. It also poses problems for historical materialism, because it puts the primacy of value in exchange rather than production, and thereby inclines to a Smithian view of things (no doubt not intentionally). As Andrew Kliman has argued, it is exactly this failure to distinguish conceptually between value and exchange value that lies at the basis of much confusion in the non-Marxist literature (and some Marxist too) about what precisely the role of value is in relative prices.(3)

In the course of the book, Heinrich levels two major critiques at Marx’s theories. One is Marx’s solution to the so-called ‘transformation problem’, i.e. the conversion of values into the concrete market prices in the practice of capitalist production and exchange; the other is Marx’s identification of a tendency for the rate of profit to fall.(4) Unfortunately, while getting a dig in at the competing interpreters of Marx on the former point, he says nothing more about it, instead referring to another text not under review here. So I will have to disregard that. On the second point, he produces a more systematic critique. Marx’s tendency of the rate of profit to fall rests upon the notion that as the organic composition of capital rises (the value of the means of production relative to the value of the labor-power employed) it will tend to rise faster than the rate of surplus value (the ratio of surplus value to the value of labor-power employed), mainly by the fact that capitalism tends to replace living labor with machines, and only living labor can add new value. All else being equal, the result of automation is, over time, a fall in the rate of profit. Marx identifies counter-tendencies to this – either increasing the rate of exploitation of remaining workers, or a cheapening of the means of production by productivity increases in the sector producing them – but considers these over the longer run to be weaker than the tendency itself. Heinrich argues he gives no reason for this, and proposes a mathematical solution in which the rate of profit will tend to rise.

However, this critique is not convincing. Firstly, it is not actually new: Michael Lebowitz already suggested it in a paper called “The General and the Specific in Marx’s Theory of Crisis”, written in 1982.(5) There, Lebowitz suggests that Marx’s argument holds on the side of the likelihood of general increases productivity not being matched in the production of the means of production themselves – not so much because machines cannot be made with machines and productivity increase in this domain, but because the ability of capital to induce such productivity increases proportionally in agriculture, mining, and the production of other raw material inputs is limited. One barrier to capital’s expansion here is nature itself, as indeed it often is, as is more obvious than ever today.

From the other side of the coin, Heinrich’s argument has been well dealt with by Michael Roberts.(6) As Roberts notes, for Heinrich’s critique to work, a capitalist tendency would have to be to increase productivity of capital by means of a declining value of constant capital (i.e. means of production, machines etc) employed. It is hard to imagine many situations in which this were to occur, indeed unless there was a proportionally much more dramatic increase in the productivity of the sectors producing these machines, as well as the raw materials etc. This is implausible in the overwhelming majority of real cases of capitalist production. Neither can this be compensated for by a rising rate of surplus value: as Roberts notes, even if wages tend towards zero and the rate of surplus value tended towards one, the relative decline in living labor will over time induce a relative decline in the rate of profit, whatever the rate of surplus value. This also underlines a point Heinrich otherwise makes well in this book: value and price are not the same, nor are surplus value and profit; the former are abstract phenomena operating on the level of capitalism as a whole, the latter are more concrete and immediately visible phenomena operating at the level of individuals.

The argument over the fall in the rate of profit may seem obscure, but it is of great significance because of its centrality to Marx’s crisis theory. Accordingly, Heinrich denies that Marx has a real crisis theory. What he means by this is that for Marx, ultimately the crises of capitalism are not only inherent to the movement of capital, but also necessary for it. I do not much agree with Heinrich’s analysis of how crisis concretely happen – he combines a classic emphasis on overproduction relative to effective demand with the impossibility of sustaining sufficient expectations of profit to make capitalists prefer investment over interest-bearing capital. These are the classic elements of Keynes’ theory of crisis, and as the current crisis demonstrates, they are not sufficient. What we have today is a situation where there is a tremendous amount of liquidity, and there is still an expanding private debt bubble sustaining consumption, and there are extremely low interest rates; and yet there is no investment. In Heinrich’s model of crisis, this should not occur.

However, he is certainly right to emphasize crises as a barrier to capital, but not as a guarantee of collapse. He is right to critique Marx’s occasionally overoptimistic interpretations of crisis as making the collapse of capitalism inevitable. Marx seems to have assumed not so much that crisis itself would bring down capitalism – in fact, the deepest moment of a crisis is the moment that the rate of profit is restored and capitalism as a system becomes healthy – but that people would, over time, come to see through the recurring crises that capitalism is an irrational and destructive system and should be gotten rid of. While it is certainly true that moments of major capitalist crises produce upsurges in revolts and in radical critiques of the social relations that prevail among us, it is simultaneously also true that crises are the moments of organizational weakness and vulnerability for unions, social movements, and working class parties, even including communal forms of collectivity. Revolutionary moments do indeed happen, but Heinrich is right to emphasize that this is not anything guaranteed by the will of history, and that nobody can yet predict where they come from or what form they will ultimately take.

One weakness however of Heinrich’s version of Marx’s economic theories is that it ultimately resolves into a purely ethical critique: if there is no tendency of the rate of profit to fall, and the limitations of capital are ultimately the Keynesian ones of demand and expectations, then crisis may appear more as a problem of capitalist management than as a moment revealing the limited potential of humanity entrapped within the capitalist frame. It is not that one can dismiss a theoretical argument by pointing to its political consequences; but Heinrich has little room for what seems to me one of Marx’s overarching ideas about capitalism, namely that its own tendency is ultimately not just to ‘create its own gravediggers’, but also to give them the tools to dig that grave: the profit system itself becomes incompatible with the development of technology, because it uses that technology against the majority of humanity instead of in its interest. This view has often been associated with the productivism of the Soviet Union, but it is one worth salvaging from the wreckage of that society, in my view. Humans must “burst the integument asunder”, and this act itself is not an ethical act against the destructiveness of capital alone, but an act of freeing human potential.

On the whole, the great strength of Heinrich’s book is the persistent emphasis on capitalism as a set of social relations, where each element plays its necessary part in the reproduction of the whole. Too often, this or that aspect of capitalism is analyzed as the problem in reformist media and politics, without real insight into why such a ‘problem’ exists or persists at all. Within Marxism, too, there has sometimes been insufficient attention to how capitalism is, as any mode of production, an all-or-nothing deal. One cannot have capitalist commodity production but do away with money, contra John Gray and others; one cannot have social planning but maintain the wage labor-capital relation, contra the Soviet leaders; and one cannot have capitalist circulation but do away with debt and financial speculation, contra much of the current reformist wisdom. Heinrich rightly notes how Capital is an analysis of any possible capitalism, not of a particular one, and operates at that level of generality. This is why its lessons remain just as relevant today as they were in 1870, if not more so, and why the laws of motion of capital it identifies cannot be simply tinkered with within the confines of social-democratic politics. There is here a risk in Heinrich’s presentation, in that his resistance to a historical rather than a theoretical interpretation of Capital makes him present real capitalism too purely: for example, the classic ‘double freedom of the worker’ as the foundation of capitalist production is real enough, but we must never lose track of capitalism’s accumulation through slavery, indentured servitude, penal labor, debt bondage, and so forth – all forms of exploitation which, as Jairus Banaji has convincingly argued, can under particular historical circumstances be subsumed under capitalism and serve just as well the aims of its reproduction.

That said, understanding Marx’s law of value as a ‘real abstraction’ operating at the level of capitalism’s reproduction as a whole is very important, and cannot be restated often enough. It clarifies many of the confusions that arise from misunderstanding what Marx is trying to do in formulating it. Capital, Marx’s critique of political economy constitutes a critique of the foundations of the bourgeois economists’ understanding of capitalism, just as valid today as when it was written. It is a critique of how they understand this society in naturalized, technical terms, as a (mathematical) interaction between abstract individuals and abstract choices in a historical void; rather than as particular social relations with a historical origin, a logic that determines how such a way of living and producing is itself reproduced, and hopefully an end. As Heinrich says: “Marx took aim at a central issue of the critique of political economy, namely, that the naturalization and reification of social relationships is in no way the result of a mistake by individual economists, but rather the result of an image of reality that develops independently as a result of the everyday practice of the members of bourgeois society. (…) These relations impose a certain form of rationality to which all individuals must adhere if they wish to maintain their existence within these conditions. If their actions correspond to this rationality, then the activity of individuals also reproduces the presupposed social relations.”(7) If one takes one thing from Heinrich’s book, it should be this.

1) It is worth noting here that in the original German, the book is not actually called “An Introduction to Marx” at all, but rather to political economy, which gives rather a different effect. I am informed that it forms part of a series introducing different theoretical subjects within the left, produced by, and therefore its orientation to the ongoing debates in Marxist interpretation is somewhat less contrastive. I thank the translator, Alexander Locascio, for this point.
2) Guglielmo Carchedi, Behind the Crisis: Marx’s Dialectic of Value and Knowledge (Leiden 2011), p. 73.
3) Andrew Kliman, “Marx’s Concept of Intrinsic Value”. Historical Materialism 6:1 (2000), p. 89-114.
4) I do not, contrary to many commentators on Marx’s value theory, write about a ‘law of the tendency of the rate of profit to fall’. It seems to me a ‘law of a tendency’ is either redundant or a contradiction in terms, and the main purpose of maintaining it is to puff up Marx’s scientific credentials in a rhetorical way. So I speak just of a ‘tendency’.
5) Michael Lebowitz, “The General and the Specific in Crisis”. Studies in Political Economy 7 (1982), p. 8-12.
7) Heinrich, p. 34-35, 46.


An excellent review which deals with some of the most important issues confronting marxist theory today in a balanced and nuanced way. It also helps to illuminate areas of contention between Heinrich and his critics which will hopefully enable the debate to move forward in the essential task of clarifying how we help to reproduce the capitalist beast and what needs to be done to construct more human social relations.

> “More important is the notion of Heinrich that value itself exists in and through the exchange of commodities – this fails to distinguish conceptually between exchange value and value, as can be seen in Heinrich’s failure to really explain how some things aren’t reproducable as commodities and yet have a price. It also poses problems for historical materialism, because it puts the primacy of value in exchange rather than production, and thereby inclines to a Smithian view of things (no doubt not intentionally).”

I was reminded heavily of Robert Kurz’s exact point on this in Substance of Capital. Heinrich’s understanding of value is often called identical to the bourgeois subjective theory of value precisely because he sees value as so much a factor of exchange. Exchange is often understood as a subjective act aimed toward the realization of a use-value via a value, production as an objective act aimed toward the pure realization of value. By over-emphasizing exchange, Heinrich arguably de-emphasizes the objective nature of capitalism that makes it a set of social relations and not just a sum of individual actions.

I can also certainly see your heavy Postone influences throughout the article. Fantastic work!

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