I read Capital, and the whole thing just went over my head. I really couldn't understand what he was getting at. Could any comrades help explain the LTV? Thanks! 
this post was submitted on 18 Jan 2024
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No, a 100 HP and 200 HP engine have different components that each have different amounts of value embedded in them. They are different products. In the market, the 200 HP engine is priced higher than the 100 HP engine not because it produces more HP, but because it is larger, has more materials in it, and the components have to deal with larger heat and energy loads so they may even be higher quality.
The 200 HP engine might even have twice as much material and components in it. There is more labor going into mining and producing those components, and also more work going into the assembly.
True. But that doesn't mean the 100 HP engine is cheaper to make. It could just as easily be cruder and less efficient. An engine that is assembled incorrectly, for instance, can have less (or no) output relative to one assembled optimally. An engine made from improper components can have a lower safe operating tolerance. Or it may simply be thanks to advances in material sciences / engine geometry / assembly technique that we achieve more torque from an equivalent input of labor and raw inputs.
You can build a 65" flat screen TV today using less material and fewer expensive components than a 16" tube-screen TV from the 1980s. That's entirely thanks to our understanding of the physics and material science surrounding the assembly process.
In either case, the concept of labor value doesn't change. The laborer has access to a certain capital/material stock and attempts to create a useful output. The relative success of the endeavor can create more utilitarian value based on a host of factors. Recognizing inefficient labor application as waste means prioritizing a certain amount of labor education, capital improvement, and R&D in order to conserve labor value.
By contrast, in a market-based economy, all we care about is the exchange value of the components we produce. If a 100 HP motor sells for the same as a 200 HP motor, then there's no incentive to upscale and no conception of waste at the level of the manufacturer. In some cases, there may be incentives to discourage conversion to 200 HP motors, because this would require increased input costs for the producer that don't resolve as exchange-value revenues.
The labor value of the market-based economy may be equivalent to that of the planned-economy, assuming the number of man-hours is the same.
But the waste of labor value in the market-based economy is going to be higher, because the economy continues to produce lower-utility 100 HP engines in pursuit of maximum exchange value return. The real expected utility value of those labor hours is lower.
A Marxist sees this disparity in utility as an economic cost (labor value is being wasted), while a Capitalist only recognizes the marginal return on sales and therefore considers 100 HP motors and 200 HP motors as equivalent (labor value is ignored).
Would it be sufficient to say that labor that is employed to produce commodities at the social average of costs, quality, the utility of the final product, etc. is what gives commodities their value? That would account for ineffective utilization of labor as you state.
That commodities/services are a consequence of labor applied to capital over time.
And the labor value actualized/squandered is equal to the utility of the commodities/services they produced as a percentage of the maximal utility value they could have produced.
Labor value exists as a function of potential man hours * time * most-efficient-product/service rendered. And that labor value can be realized or lost, depending on whether the laborer is employed efficiently. Thus, the goal of a well-run economy is to maximize the utility output of individuals in order to achieve a long-term improvement in quality of life for the polity.
Hence "from each according to their skill, to each according to their need". Maximize utility of labor inputs. Equitably distribute outputs.