This is the second entry in our series exploring Marx in an approachable manner. Our first piece explored Alienation; now, we move on to the Social Character of Labour. Unlike the piece on Alienation, that focused primarily on that one key concept, this essay will examine the Social Character of Labour through a set of economic concepts and apply them to a contemporary example: Generative AI.

We will use the following flow:

• We will establish the philosophical foundation: Alienation from Product and Species-Being
• We will explore Marx’s economic mechanisms: the Labour Theory of Value (LTV) and Surplus-Value
• We will briefly re-touch on Commodity Fetishism
• We will investigate Marx’s concept of the General Intellect and the crisis of value

First, we must briefly recap the core idea from my first essay: Inversion. Marx argues that capitalism is defined by a fundamental structural flaw where humanity is alienated: the things we create turn against us, solidified into a hostile force that dominates us. The point of the previous essay was to show that this is not a psychological state, but a material violation of human potential.

The specific mechanism for this Inversion is the worker’s alienation from their product, where their creation immediately becomes the private property of the capitalist. Marx makes the following crucial claim: private property isn’t the starting point of capitalism (a simple legal fact) but its daily result and necessary consequence. As Marx writes in the Economic and Philosophical Manuscripts:

True, it is as a result of the movement of private property that we have obtained the concept of alienated labour… But on analysis of this concept it becomes clear that though private property appears to be the reason, the cause of alienated labour, it is rather its consequence.[1]

While initial historical events (Primitive Accumulation) created the separation of the worker from the means of production,[2] the wealth of the capitalist is continuously re-captured from the very labour that creates it. This structural focus is crucial: we are not observing isolated events but a system defined by the structural relations that daily seize the worker’s creation. This leaves a critical question: If private property is the estranged product of human labour, how is the value of that stolen product generated and measured?

The Source of Value: Marx and the LTV

To answer that question, we transition to Marx’s economic framework, anchored by the Labour Theory of Value (LTV). Marx did not invent the LTV; he inherited it from Classical Political Economy (Adam Smith and David Ricardo). The LTV provides an objective measure of value by anchoring it in Socially Necessary Labour Time (SNLT). This ‘social average’ isn’t just about an individual worker’s effort; it confirms that wealth creation is fundamentally a collective process. For any product to have value, the concrete labour used to make it (the specific act of coding or building) must first be validated as a necessary part of society’s total social labour. Marx then draws a critical distinction: Concrete Labour is the specific, useful activity that creates a product (e.g., coding, writing, building a car). But the market ignores this uniqueness. Instead, it only registers Abstract Labour, which is the generalized, undifferentiated expenditure of human energy.[3]

Critically, the capitalist doesn’t purchase your specific, useful abilities; they buy your generalized, measurable capacity to labour. This abstract labour is the true social substance of value, as it reduces all unique work to a single, comparable measure of time, confirming that individual effort only acquires value by being validated as a piece of the total social labour of the economy. This economic measure echoes Marx’s philosophical assertion: our capacity for labour itself is a social product, relying on inherited language, knowledge, and infrastructure: a collective legacy that renders the concept of the ‘self-made’ individual an illusion.

Not only is the material of my activity given to me as a social product (as is even the language in which the thinker is active): my own existence is social activity, and therefore that which I make of myself, I make of myself for society and with the consciousness of myself as a social being.[4]

Marx applied the LTV to the commodity that creates more value than it costs to produce: labour-power. The capitalist pays the value of the worker’s labour-power (the SNLT required to sustain them), but then forces them to work longer, generating surplus-value: which is unpaid labour time. This surplus-value, which is the sole source of profit, is the material proof of the exploitation embedded in the private seizure of the worker’s time. Critically, the LTV is useful because it provides the objective standard to confirm that wealth creation is fundamentally a social process originating in human activity, even if the proportion of living labour in production is drastically reduced by automation, leading to a profound crisis in the value-form itself.

Although value is objectively created by social labour and surplus is extracted via exploitation, capitalism successfully masks this reality through Commodity Fetishism. This is the process by which commodities are invested with a mysterious, objective power, making it seem as if their value comes from their physical properties or the laws of the market itself.[5] This fetishism obscures the social character of labour, making exploitation appear simply as an innocent exchange between things (a wage for hours). Ultimately, it conceals the antagonistic class relations beneath the appearance of a natural, objective exchange.

Value Crisis and Primitive Accumulation

Capitalism is driven by one imperative: maximizing surplus-value. However, the system contains a self-eroding contradiction. Marx argued that to maximize output and defeat competitors, the capitalist constantly invests in fixed capital (machinery, infrastructure): this is what Marx termed Constant Capital (C) – or Dead Labour – because it represents value created by past labour. This investment drastically increases productivity, but it simultaneously reduces the amount of live human effort, which is Variable Capital V – or Living Labour – required for each commodity.[6]

The contradiction is this: living labour (V) is the sole source of new value and profit, while machinery (C) – dead labour – merely transfers its existing value. A helpful analogy is to think of the machine as a battery of stored value. The stored value was created by past labour and only transfers its own fixed value, wearing out in the process; it cannot generate an extra surplus. Only the worker, the “generator,” creates more value than they consume. Therefore, as the ratio of Dead Labour (machinery/C) to Living Labour (workers/V) continually rises, the process systematically devalues and diminishes the very base (living labour) from which profit is generated. This structural dynamic (the fall in profitability, or what Marx called the tendency of the rate of profit to fall) creates a systemic crisis that forces capital to find a new, uncompensated, and vast source of social wealth.

Marx’s insight into this crisis is found in the Grundrisse. As direct labour input (V) becomes negligible, Marx argued that the true source of wealth shifts to the General Intellect. The General Intellect is the accumulation of science, knowledge, technical skill, and cultural production: it is the social brain of humanity.[7] Marx captures this structural transformation and the emergence of collective wealth by writing:

[The worker] steps to the side of the production process instead of being its chief actor… In this transformation, it is… the appropriation of [their] own general productive power, [their] understanding of nature and [their] mastery over it by virtue of [their] presence as a social body – it is, in a word, the development of the social individual which appears as the great foundation-stone of production and of wealth.[8]

This structural development exposes the contradiction of value measurement in automation. In a desperate, contradictory attempt to re-establish a value-base, capital appropriates the General Intellect (a purely social resource) treating it as if it were a new source of Variable Capital (V) to offset the falling rate. However, as the LLM example I explore below will show, the General Intellect is systematically transformed into a privately owned Dead Labour (C) asset. The logical conclusion is that wealth creation is now exclusively social, and capital’s attempt to privatize this collective intellect only accelerates the system’s inherent crisis. This means capital’s structural response to the falling rate is ultimately a self-defeating maneuver, accelerating the crisis it is trying to resolve because the new Constant Capital (C) cannot produce new surplus-value.

The General Intellect is intensely material. It is the stock of social knowledge codified in technology (e.g., algorithms and model architectures). The internet is the physical archive of this General Intellect. This archive is continuously fed by the flow of social labour (the collective, communicative, and cognitive work we perform every time we post, comment, review, or contribute data).

The massive archive of collective knowledge, generated by this social activity, is treated by capital as a massive, ‘free Gift of Nature’.[9] The LLM enclosure is therefore a new act of Primitive Accumulation: the violent, systemic theft that converts a ‘free gift of nature’ (the General Intellect) into a private Constant Capital (C) asset (the trained model).[10] This shift means the crisis of value (rising C:V) is resolved by externalizing the creation of C onto the unpaid public, making the theft a deeper appropriation of social wealth, not just surplus-value.

The Crisis of Value in the Digital Age

The task now shifts entirely from explaining Marx’s concepts to applying them to Generative Artificial Intelligence (AI). Today, Large Language Models (LLMs) and Generative AI are the most explicit expression of capital’s desperate search for profit in a post-devaluation economy. These models are not built on classical wage-labour, but on the unpaid social brain of humanity. If Marx’s General Intellect is the collective source of wealth, then the modern crisis is clear: the training of LLMs represents the most advanced act of its privatization yet. This theoretical groundwork leads to one critical conclusion for the 21st century: the training of LLMs constitutes a new historical enclosure, systematically appropriating the General Intellect and solidifying it as proprietary capital.

AI and the Mechanism of Enclosure

The theft of the General Intellect is a physical, computational act rooted in this new form of enclosure. The primary mechanism is Web Scraping: the automated, mass collection of publicly available data. The resulting LLM training dataset is the materialized General Intellect: a captured snapshot of collective social labour. The AI company then performs a massive computational conversion: it takes this collective, social fixed capital (the web archive) and, through the training process, converts it into a proprietary artifact: the trained model.

The final step is ideological. After the theft, the model must be presented in a way that conceals its origins. This concealment involves two related, but distinct, processes:

• Commodity Fetishism (Marx) masks the value form in the market, endowing the LLM with a supernatural power that entirely obscures the social relations and stolen labour embedded within it.[11]
• Reification (Lukács) rationalizes the entire social process, presenting it as an objective, natural, immutable thing (i.e., ‘natural intelligence’ or ‘objective code’).[12]

This tandem operation successfully transforms the systemic appropriation of our collective social labour into what appears to be a natural triumph of private capital.

The analysis of LLM appropriation culminates in Marx’s earliest and deepest critique: Alienation from Species-Being (our essential human nature). The General Intellect is the material expression of our Species-Being: our collective capacity for free, conscious, and universal creative activity.[13] The LLM enclosure is the ultimate act of alienation because the theft isn’t just the raw data: it is the capture and limitation of the General Intellect’s emancipatory potential. The knowledge that should serve as the material basis for universal human freedom is instead re-forged as a proprietary instrument of private accumulation and domination.

Mazzucato on Unearned Value Extraction

To provide more grounded validation, we can bring in the work of non-Marxist economist Mariana Mazzucato. Her work defines a crucial distinction in modern capitalism: Value Creation versus Value Extraction.[14] Value Creation refers to the collective effort (often state-backed via taxes) that produces new wealth and knowledge (e.g., public research, foundational internet protocols, and the General Intellect archive). Value Extraction, conversely, describes activities that merely shift, claim, or skim value without actually generating it.

Applying Mazzucato’s distinction supports our thesis. The public/social sphere, backed by state funding, performs the Value Creation for the digital economy. Mazzucato demonstrates that core technologies like the internet, GPS, touch-screen technology, and Siri’s foundational AI were originally developed through decades of high-risk, publicly funded research.[15] Big Tech companies then entered the process as Value Extractors, absorbing these public innovations at low cost, integrating them into proprietary devices and services, and reaping massive private profits. The LLM industry continues this pattern by absorbing the General Intellect archive.

For Marxists, this is not just an “unearned” profit (an ethical claim), but the reappropriation of social wealth created by social labour: specifically, the past labour funded by the state for R&D and the present immaterial labour that generates the data. Mazzucato’s “Value Extraction” is, in Marxian terms, the capture of Surplus-Value (the unpaid portion of collective, social labour) and the appropriation of the General Intellect as a common resource. The entire process demonstrates Mazzucato’s claim that the risk is socialized (borne by the public/state), while the resulting profit is privatized (captured by the AI firm).

Recapping What We Have Covered

The entire argument traces the logic of social theft from its philosophical roots to its high-tech expression. We began by establishing the Inversion of humanity’s creative power into an external, hostile force, defining private property as the estranged product of labour. We then used the Labour Theory of Value (LTV) to provide an objective, social standard for this theft, showing that surplus-value (profit) is simply the unpaid appropriation of collective human time. This exploitation is masked by Commodity Fetishism, which obscures the fundamental class relations beneath the appearance of natural market exchange. This theoretical base allowed us to diagnose the system’s internal crisis: the essential contradiction between Constant Capital (C) (dead labour/machines) and Variable Capital (V) (living labour/sole source of value). Capital’s desperate imperative to offset the resulting falling rate drives it to violently appropriate the General Intellect: the vast, social brain of humanity. Thus, the LLM enclosure is not a mere market accident; it is the structurally necessary, modern act of Primitive Accumulation, converting our collective knowledge into proprietary capital.

Reclaiming Social Wealth Through Struggle

By accepting Marx’s theory that the identity of things is constituted by the relations they enter into,[16] we recognize that the LLM enclosure is not an external problem, but the internal, logical expression of the crisis of value under advanced capitalism. The drive to privatize the General Intellect is structurally necessary for capital’s survival because of its internal contradictions (the falling rate/crisis of value). The pathological drive for accumulation that necessitates the theft of the General Intellect is the same underlying structural contradiction that necessitates the exploitation of land and resources (the climate crisis), the structural violence of racism, the subjugation of bodies and identities (patriarchy), and the ongoing devastation of colonialism and imperialist extraction. Furthermore, this same logic drives the profiteering that intensifies the cost-of-living crisis for working-class people all over the world. These are not externally related issues (e.g., “AI is bad, and imperialism is also bad”); rather, they are different phenomenal forms of one underlying structural contradiction: the drive of capital to turn all life and social activity, from our collective knowledge to the earth itself, into a privately appropriable resource. This realization dissolves the silos of single-issue politics and links the struggle of the knowledge worker to the globally oppressed.

The lesson of Marx is that the powerful will not willingly relinquish that which gives them power. Since capital must structurally and ideologically appropriate our social wealth to survive, the task is not negotiation; the task is reclamation. The struggle to secure the General Intellect as a universal common resource demands a unified, conscious, and ultimately non-pacifist act of liberation. It demands that we tear away the veil of fetishism and recognize our shared condition.

Our collective power is the source of all wealth. If the final battlefield of capital is the mind and the network, then we must meet it with solidarity. We are all knowledge workers fighting to reclaim our social intellect. We are all families crushed by the rising cost of survival. We are all peoples fighting against colonialism and the exploitation of the Global South. We are all movements resisting the structural violence of racism. We are all communities struggling to protect the climate from extraction. We are all people fighting for bodily autonomy and self-determination. Our struggles are shared, our enemy is one, and to reclaim our human essence, the one thing we absolutely cannot all be, is pacifists.

Notes

1. Karl Marx, Economic and Philosophical Manuscripts of 1844, First Manuscript (Estranged Labour).

2. Karl Marx, Capital: A Critique of Political Economy, Vol. 1, trans. Ben Fowkes (London: Penguin Classics, 1990), 874-875.

3. Ibid, 128-129.

4. Karl Marx, Economic and Philosophical Manuscripts of 1844, Third Manuscript (Private Property and Communism).

5. Marx, Capital Vol. I, 165.

6. Karl Marx, Capital: A Critique of Political Economy, Vol. 3, trans. David Fernbach (London: Penguin Classics, 1981), 318-319.

7. Karl Marx, Grundrisse: Foundations of the Critique of Political Economy (Rough Draft), trans. Martin Nicolaus (London: Penguin Classics, 1993), 705-706.

8. Ibid, 705.

9. Marx, Capital Vol. 3, 184-185.

10. Marx, Capital Vol. I, 875.

11. Marx, Capital Vol. I, 165.

12. Georg Lukács, History and Class Consciousness: Studies in Marxist Dialectics, trans. Rodney Livingstone (Cambridge, MA: MIT Press, 1971), 83-110.

13. Karl Marx, Economic and Philosophical Manuscripts of 1844, Third Manuscript (Private Property and Communism).

14. Mariana Mazzucato, The Value of Everything: Making and Taking in the Global Economy (New York: PublicAffairs, 2018), 34–58.

15. Mariana Mazzucato, The Entrepreneurial State: Debunking Public vs. Private Sector Myths, Revised Edition (New York: PublicAffairs, 2015), 89–125.

16. See Bertell Ollman’s Dance of the Dialectic, where Ollman argues that you must understand the philosophical lens Marx inherited in order to properly understand him: The Philosophy of Internal Relations (PIR). As described by Ollman, the PIR is the fundamental principle that things do not exist independently of the relations they enter into; rather, their identity is constituted by those relations. For Marx, this means that the wage, the commodity, and the state are not separate “things”; they are internal expressions of the capital relation itself. This methodological claim forces us to see the entire capitalist system as a unified, fluid totality where every component is inherently tied to every other part. Bertell Ollman, Dance of the Dialectic: Steps in Marx’s Method (Urbana: University of Illinois Press, 2003), 1–15.

[Courtesy: Beer and Freedom, a Substack newsletter created and written by dennis that aims to make Marxist ideas accessible and grounded in everyday life rather than confined to academia.]