Right. Use-values such as air are gifts of nature, rather than of labor.
>But it does not appear to say that labor is not the source of value, i.e.
specifically capitalist value. And the early chapters of Capital do seem to
say that labor is just that.<
Labor is the source of exchange-value (the form of wealth in a commodity-producing society) and surplus-value (profits, interest, rent, some taxes). It takes labor (using dead labor, i.e., machinery) to compress and put the air into tanks so that it can be sold. And without labor, the air-compression factory owner can't get a profit.
>In other words, labor is the only source of that by which we can pay a
fair price for something in a market.<
Marx doesn't talk about "fair prices" at all. The closest he comes in CAPITAL is to _assume_ that products sell at their values, which is the way things work in a largely hypothetical system of simple commodity production (where self-employed producers sell only to each other). Most economists (of his day and today) have the idea of simple commodity production stuck in their heads and it sort of plays the role of determining what they mean by "fair prices" (no monopoly, etc.) though they don't use that term. (Rather, they talk about "Pareto optimality" and the like.) One of the points of CAPITAL is that capitalism is _not_ a system of simple commodity production.
Jim Devine jdevine at popmail.lmu.edu & http://clawww.lmu.edu/Departments/ECON/jdevine.html