Brief Two — The Chapter on Money The critique of labour-money, money as the autonomous form of exchange-value, and money as impersonal social power — the real community of bourgeois society.

The Chapter on Money opens the analysis proper, and it does so polemically, through a critique of the Proudhonist Alfred Darimon's scheme for a reformed money that would abolish the crises of capitalism by abolishing gold. Marx uses the occasion to establish a thesis that governs the whole critique: money is not an arbitrary device that could be reformed or legislated away while leaving commodity production intact; it is the necessary product of a society in which labour is private and social only through exchange. The contradictions that money seems to cause are really the contradictions of the commodity form itself, merely brought to visible existence in money. From this negative starting point Marx develops the positive analysis: how the contradiction latent in the commodity — that each product is a particular use-value yet must count as general, exchangeable value — drives toward money as the independent, autonomous existence of exchange-value; and how money, precisely because it is the general form of social wealth held by private individuals, becomes an impersonal social power, the "real community" of a society that has dissolved all personal bonds. Much of what Capital Chapters 1–3 present in compressed form is worked out here at greater length and with a more explicit philosophical horizon — above all the account of money as the alienated social bond, in which the social power of individuals confronts them as the property of a thing. This brief carries those load-bearing formulations, which are among the passages the value-form tradition most often reads against Capital.

Darimon, following Proudhon, proposed that the crises of capitalism arise from the special privilege of gold and silver, and that a bank issuing "time-chits" — certificates representing hours of labour, exchangeable directly against products — would let commodities circulate at their labour-values without the tyranny of precious money, abolishing crisis at a stroke. Marx's refutation is patient and devastating, and its logic is the same one he would use against every reformist monetary scheme thereafter. The scheme wants to keep commodity production — private production for exchange — while removing money, its necessary form. But money is not the cause of the contradictions of exchange; it is their solution and their expression. A commodity's price and its realization in sale can diverge; a producer's private labour may or may not prove socially necessary; these possibilities are inherent in a system where labour is validated as social only after the fact, through exchange. Time-chits would not abolish that gap — they would merely rename it, since a chit certifying an hour of individual labour cannot guarantee that the hour was socially necessary. The bank would have to become the general buyer and seller, the planner of all production, which is to abolish commodity production altogether — the opposite of what Proudhon intends. Marx's conclusion is that one cannot reform the money form while preserving the commodity form; to attack money without attacking the private, exchange-mediated character of labour is to attack a symptom and leave the disease. The critique establishes the internal necessity of money and clears the ground for its derivation.

Marx states the fundamental question at the outset, and it is the question every circulation-reform scheme since has had to face.

Can the existing relations of production and the relations of distribution which correspond to them be revolutionized by a change in the instrument of circulation, in the organization of circulation? Further question: Can such a transformation of circulation be undertaken without touching the existing relations of production and the social relations which rest on them? If every such transformation of circulation presupposes changes in other conditions of production and social upheavals, there would naturally follow from this the collapse of the doctrine which proposes tricks of circulation as a way of, on the one hand, avoiding the violent character of these social changes, and, on the other, of making these changes appear to be not a presupposition but a gradual result of the transformations in circulation.

Marx, Grundrisse, The Chapter on Money, page 122.

The technical refutation of the time-chit follows: the certificate of labour time could never coincide with the labour time the market actually validates.

The time-chit, representing average labour time, would never correspond to or be convertible into actual labour time; i.e. the amount of labour time objectified in a commodity would never command a quantity of labour time equal to itself, and vice versa, but would command, rather, either more or less, just as at present every oscillation of market values expresses itself in a rise or fall of the gold or silver prices of commodities.

Marx, Grundrisse, The Chapter on Money, page 139.

And the reductio is drawn out step by step until the reformist programme confesses what it would actually require.

In this last formulation the problem would have reduced itself to: how to overcome the rise and fall of prices. The way to do this: abolish prices. And how? By doing away with exchange value. But this problem arises: exchange corresponds to the bourgeois organization of society. Hence one last problem: to revolutionize bourgeois society economically. It would then have been self-evident from the outset that the evil of bourgeois society is not to be remedied by ‘transforming’ the banks or by founding a rational ‘money system’.

Marx, Grundrisse, The Chapter on Money, page 134.