Explain M-C-M’ to show how capitalists maintain and increase their wealth.

M represents the initial amount of money the capitalist begin with. The capitalist then uses this money to purchase commodities which is the C. This includes physical goods and labor power. Labor power is the ability of workers to work, which the capitalist buys to produce goods or services. The capitalist’s goal is not just to buy commodities for personal use but to use them in a productive process. By investing their money in commodities, including raw materials, machinery, and workers’ labor power, capitalists are looking to create something new. In the process of production, the value of the commodities transforms into something of greater value. After the goods are produced, the capitalist sells these commodities for money again which is the last M. But the last M is greater than the original M because the value of the commodities sold has increased. This is profit or surplus value, which is the value created by a worker’s labor that is above and beyond the value of their wages. After the capitalist pays the worker a wage, they keep the surplus value for themselves once the products are sold.

Capitalists maintain and increase their wealth through the withdrawal of surplus value from workers. This process is the cycle of M.C.M. The capitalist reinvests the surplus value back into buying more commodities to produce even more goods. Capitalists accumulate wealth over time by exploiting the workers who generate surplus value, generating more wealth without having to directly increasing their own labor input.