KARL MARX'S three volumes of Capital have been analyzed and debated by Marxists since their publication more than 150 years ago. So it might seem that a new interpretation of this work would be impossible. But German Marxist Michael Heinrich has achieved just that with his An Introduction to the Three Volumes of Karl Marx’s Capital.

Heinrich’s written work on Marx’s theories began in 1991 with a doctoral thesis called “The Science of Value.” (It has been updated and will be a forthcoming title in the Historical Materialism book series.) In 2004, he first published the German edition of the Introduction. The book has been updated several times since and in 2012 became the first of Heinrich’s works translated into English.

Heinrich repositions many of the key arguments in the three volumes of Capital—including the theory of value, the theory of money, the theory of the tendency of the rate of profit to fall, and Marx’s arguments on commodity fetishism. His assessments stem from what he views as a mistranslation of some of Marx’s arguments and cites the original German text. He also undertakes an examination of Marx’s notes and lesser works to build his argument.

Heinrich attacks the conception of orthodox Marxism—what he calls “worldview Marxism”—that interprets Marx’s analysis of capitalism as being rooted in a general theory of different modes of production. This interpretation of Capital leads to a reading of the early chapters as being a description of simple commodity production as a phase of capital that preceded more advanced capitalism. Heinrich argues that there is no historical content to this analysis—that Marx’s arguments on simple commodity production are merely an attempt to draw an idealized and abstract picture of a simplified version of capitalism in order to more clearly analyze its dynamics. He argues that this abstraction underlies most of the three volumes, with only sections of Volume III describing capitalism as it actually exists.

At the heart of Heinrich’s argument is a recasting of Marx’s theory of value. Specifically, he rejects the conception that by using the term abstract labor Marx was making a physiological argument about the amount of work and value embedded in commodities. Instead, he argues that value is a social relation. He admits that Marx does use both terminologies at points in Capital and in his other writings, but a deeper textual reading reveals a different interpretation, that ultimately Marx’s argument is that the value of commodities consists of “crystals of this social substance, which is common to them all.”

Heinrich argues that value is ultimately a reflection of a social relation that doesn’t fully emerge until the process of circulation. Marx’s theory of value is not just one rooted in production but an all-encompassing theory of production and circulation together as a unified process (which, Heinrich argues, is why all three volumes of Capital need to be read to grasp the theory, not just volume I). Not until exchange takes place does the abstraction of determining a commodity’s value take place. And a commodity’s value can only be realized when it is put in opposition with other commodities. This is jarring, especially if you have an understanding that places value creation in production and realization of value in the market and sees these processes separated by time and space.

Heinrich contends, ultimately, that Marx’s theory of value is actually a monetary theory of value, and he roots this in Marx’s own explanations of money. Most intriguingly, with this interpretation Heinrich is able to brush away what has historically been one of the biggest arguments surrounding Capital—that of the “transformation problem” whereby it becomes difficult to transform values into prices. Heinrich’s explanation is that value and price are actually two different and simultaneous levels of abstraction. One need not be “transformed” into the other.

Heinrich also rejects Marx’s notion of the “law of the tendency of the rate of profit to fall.” Using Marx’s formulas, Heinrich illustrates that a declining mass of surplus value can result in either a rise in the rate of profit or a fall, depending on what happens with total capital. Ultimately, the rate of profit can fall, but Heinrich argues that there is no evidence of a long-term tendency. Instead, he argues that crisis is embedded in capitalism at another level—investment in productive capacities of capital again and again outstripping consumptive capacities, thus leading to overproduction and over accumulation. Crises, then, wipe away these excess capacities and clears the way for new periods of growth. Heinrich does not address, however, the work of other Marxist economists who have calculated rates of profit in the economy that have shed light on how the tendency functions.

This recasting doesn’t alter other key parts of Marx’s analysis—such as the unique character of labor in producing new value (rather than passing on its value as machines and tools do). And it dovetails with explanations of the root of surplus value and the importance of surplus value and profits as the motive forces behind capitalist production.

Other lucid parts of the book include descriptions of Marx’s theory of money, which Heinrich argues have been overlooked historically. His explanation of fetishism, as well, is clear and refreshing. He actually broadens the theory and argues that Marx was not merely talking about fetishism in commodities—i.e., humanity and meaning being bestowed on the things workers create. Heinrich says this fetishization also applies to money and to capital.  

In addition, Heinrich’s short chapter on the state is excellent. He argues that Marx was not able to adequately deal with the role of the state in Capital itself and rejects the classic argument that the state is an extension of the ruling class. Heinrich argues that states have a vested interest in maintaining capitalism, but because of the dispersed nature of the ruling class itself, the relationship cannot be simplified to the notion that the state is simply a tool of class domination. At times, the state plays the role of doing what’s best for capital as a whole even if sections of the ruling class oppose it. He points to disability insurance, unemployment benefits, and welfare that can help ensure the reproduction of the working class, which is essential for capitalism. But the cost of this is appropriating a share of surplus value that individual capitalists may oppose.

Heinrich does try to relate the theories to the history of capitalism and to actual lived experience since Capital’s writing, but some of his explanations raise questions. For example, Heinrich attributes the long boom years after World War II to “Fordism,” i.e., a strategy of capitalists to raise production and workers’ living standards simultaneously. But the explanation for why this shift occurred and why the phase ended are not compelling, and notably absent is any account of how workers’ struggles influenced these processes.

Ultimately, there’s a lot to chew on in reading Heinrich despite the book’s relatively short length. That’s especially true for those steeped in more orthodox interpretations of Capital. It’s a book that should be read and debated.

Despite its title, however, the book is not an introduction to Capital that’s only geared towards new readers. Because it’s so steeped in the historical debates about Capital’s meanings, parts of the book will only be accessible for readers who already have familiarity with Capital. Readers that have never read Capital may struggle with these sections, particularly the third chapter, where Heinrich delves deeply into the labor theory of value and lays out his alternative.