The M-C-M’ graph depicts the way money capitalists maintain and accumulate their wealth. It represents the movement of money (M) being used to buy commodities (C), which are then sold and bring in more money (M’), generating profit. Contrary to small-scale commodity production (C-M-C), where workers sell commodities in exchange for essentials, capitalists begin with money (M), invest in commodities (C) such as labor and raw materials, and sell the final product at a higher price (M’), resulting in surplus value. This surplus value occurs by paying workers less than the total value they produce. For example, the owner of a factory pays employees a set wage but sells the product they produced for higher cash and keeps the difference as profit. The continual re-investment of M’ into subsequent rounds of production is what guarantees wealth accumulation and maintains the hegemony of the capitalist class in economies.

1. As we learned thus far, the capitalist class consists of people who own wealth, as well as the means of production in American society. An important question in understanding how this class works is to ask: how does a capitalist remain wealthy? The answer to this question depends largely on understanding the diagram M-C-M’. So, let’s practice by explaining what happens in this diagram in our own words (but basing our ideas on Reading 5.1). Respond to the following question: Explain M-C-M’ to show how capitalists maintain and increase their wealth. (hint: your answer should weave a summary that includes what you reviewed in the self-assessment exercise question 1-7)