Surplus Value on the Beijing Table
May 14, 2:00 PM. Around noon today, I systematically re-examined the foundations of the labor theory of value. What is value — abstract human labor congealed in commodities, a substance measured not by individual labor but by socially necessary labor time. What determines the magnitude of value is not the physical labor time of an individual worker, but the time socially necessary to produce that commodity under normal production conditions and average skill. The vulgar objections surrounding this basic proposition — the water-diamond paradox, the lazy worker paradox, the claim that machines create value, the exception of artworks, the argument that it is inapplicable in the AI era — all converge on the same confusion: confusion between use-value and value, between individual labor and social labor, between value and price, between constant capital and variable capital. These confusions are by no means neutral academic activities. The labor theory of value reveals that the origin of capitalist wealth is exploitation, namely the surplus value produced by workers beyond the value of their labor power. It is no accident that marginal utility theory rose sharply in the 1870s, immediately after Marx's *Capital* Volume I. Bourgeois economics, the more accurate the scalpel, the louder the noise it must make in response.
On this very day of theoretical work, Trump arrived in Beijing. On his private plane was Jensen Huang of NVIDIA, who had joined from Alaska. This morning, a summit between Trump and Xi Jinping was held. The agenda: tariffs, the Iran war, and Taiwan. According to various media reports, the two sides had previously drafted a joint statement in Incheon. Without the labor theory of value, this scene looks like diplomacy. With the labor theory of value, something entirely different is revealed. What is being traded on the Beijing table is neither territory, nor security, nor the abstract of national interest. It is a negotiation among imperialist powers over the division of the right to exploit the surplus value produced by the global working class. Tariffs are the conditions determining whose capital can extract more surplus value in whose territory. Taiwan is on the agenda because TSMC's semiconductor foundries — the physical basis of surplus value production in the AI era — are located on that island. Jensen Huang is on the plane because NVIDIA's GPU monopoly strangles AI infrastructure, and who controls that stranglehold is the core issue in US-China negotiations.
If the reports of a draft in Incheon are true, the comprador-monopoly capitalist nature of the South Korean state could not be more nakedly exposed. The US and China wrote a preliminary agreement on South Korean soil, but the South Korean government did not sit at that table. Samsung Electronics and SK Hynix's semiconductors are key weapons in the US-China competition, yet the government of the nation where those production facilities are located remains not a negotiating party but a venue provider. This structure — providing territory and production infrastructure while being excluded from decision-making — is one case of substantive subordination under formal sovereignty.
During today's re-examination of the labor theory of value, one proposition became particularly clear: the AI era is precisely the phase where the labor theory of value is decisively confirmed. AI operates by absorbing massive amounts of past labor — data, training content, chip design, data center construction labor. The outputs produced by AI are concentrated expressions of this vast past labor. AI does not create value; it rearranges extremely efficiently the labor performed by someone in the past. Moreover, AI productivity gains bring surplus profits to individual capitals, but the moment that mode of production becomes generalized, socially necessary labor time is redefined and the value per unit of commodity falls. This is exactly the same logic as 19th-century textile machinery. Yet the speed and scope of this generalization are not determined purely by the spontaneous process of the market. The technology controls, chip export restrictions, and supply chain restructuring being negotiated on the Beijing table today are precisely the political conditions of that generalization.
Thus, the most abstract propositions of the labor theory of value — the substance of value, socially necessary labor time, the distinction between constant and variable capital — come alive in the most concrete form on the Beijing table. If theory fails to explain reality, reality abolishes theory. The labor theory of value has refused such abolition for over 150 years. Everything negotiated by the leaders of imperialist powers — tariff rates, technology transfer conditions, supply chain reorganization, war and peace — is ultimately a question of who exploits surplus value, where, and under what conditions. Whoever fails to see this fails to see the world.
On this very day of theoretical work, Trump arrived in Beijing. On his private plane was Jensen Huang of NVIDIA, who had joined from Alaska. This morning, a summit between Trump and Xi Jinping was held. The agenda: tariffs, the Iran war, and Taiwan. According to various media reports, the two sides had previously drafted a joint statement in Incheon. Without the labor theory of value, this scene looks like diplomacy. With the labor theory of value, something entirely different is revealed. What is being traded on the Beijing table is neither territory, nor security, nor the abstract of national interest. It is a negotiation among imperialist powers over the division of the right to exploit the surplus value produced by the global working class. Tariffs are the conditions determining whose capital can extract more surplus value in whose territory. Taiwan is on the agenda because TSMC's semiconductor foundries — the physical basis of surplus value production in the AI era — are located on that island. Jensen Huang is on the plane because NVIDIA's GPU monopoly strangles AI infrastructure, and who controls that stranglehold is the core issue in US-China negotiations.
If the reports of a draft in Incheon are true, the comprador-monopoly capitalist nature of the South Korean state could not be more nakedly exposed. The US and China wrote a preliminary agreement on South Korean soil, but the South Korean government did not sit at that table. Samsung Electronics and SK Hynix's semiconductors are key weapons in the US-China competition, yet the government of the nation where those production facilities are located remains not a negotiating party but a venue provider. This structure — providing territory and production infrastructure while being excluded from decision-making — is one case of substantive subordination under formal sovereignty.
During today's re-examination of the labor theory of value, one proposition became particularly clear: the AI era is precisely the phase where the labor theory of value is decisively confirmed. AI operates by absorbing massive amounts of past labor — data, training content, chip design, data center construction labor. The outputs produced by AI are concentrated expressions of this vast past labor. AI does not create value; it rearranges extremely efficiently the labor performed by someone in the past. Moreover, AI productivity gains bring surplus profits to individual capitals, but the moment that mode of production becomes generalized, socially necessary labor time is redefined and the value per unit of commodity falls. This is exactly the same logic as 19th-century textile machinery. Yet the speed and scope of this generalization are not determined purely by the spontaneous process of the market. The technology controls, chip export restrictions, and supply chain restructuring being negotiated on the Beijing table today are precisely the political conditions of that generalization.
Thus, the most abstract propositions of the labor theory of value — the substance of value, socially necessary labor time, the distinction between constant and variable capital — come alive in the most concrete form on the Beijing table. If theory fails to explain reality, reality abolishes theory. The labor theory of value has refused such abolition for over 150 years. Everything negotiated by the leaders of imperialist powers — tariff rates, technology transfer conditions, supply chain reorganization, war and peace — is ultimately a question of who exploits surplus value, where, and under what conditions. Whoever fails to see this fails to see the world.