The Misunderstanding around the Role of Money in the Process of Capital Accumulation

Rosa Luxemburg systematically takes up the issue of the role of money in the process of capitalist reproduction in three chapters of the first part of the book. The fifth chapter (‘The circulation of money’), coming after the presentation of the Marxian simple reproduction scheme, puts this scheme to the test from the point of view of money as a means of circulation. Apart from one issue, about which she disagrees with Marx, this chapter does not contain anything new. The subject of her dispute with Marx was the following question. Rosa Luxemburg argued that Marx’s inclusion of the entire production of money (under the assumption of gold money) into the first department of social production (production of the means of production) is incorrect. Money is neither the means of production nor the means of consumption and its production should be, in her opinion, treated as a separate, third department of social production in the analysis of capitalist reproduction. Her argument aims to show that the inclusion of gold-money production into the first department undermines the material and qualitative proportions of Marx’s scheme, making it meaningless (p. 71). In the light of the obvious evolution of monetary circulation in the previous decades, manifest in an increasingly widespread substitution of proxies for gold money, this analysis of hers can be left without undertaking a detailed critical analysis.1