In recent years geographers have produced a considerable literature on the creation of markets in environmental goods and services. This literature reveals numerous complications with such market-based conservation strategies, yet it has failed to address the conception of value that underlies capitalism and drives the capitalist state. To address this gap, we offer an analysis of how the concept of the value of nature has been taken up in U.S. environmental regulatory debates over the creation of markets for wetland services, where state actors creating new regulations must attempt to specify the value of nature. In 2008 the U.S. government adopted a rule governing the creation and sale of wetland credits. This rule initially attempted to define value as a way of both grounding the credit commodity in underlying phenomena and defining the object that state intervention was designed to protect. But in final negotiations and drafting the term became so controversial that its definition was deleted and its use radically restricted. To draw meaning from this situation, we draw on nineteenth-century debates over value in political economy. Our central finding is a cyclical tendency for conflicts to arise over whether to define value as something either inherent (e.g., to a physical process) or essentially relative. Agents of the state involved in creating environmental policy today are caught in the same dilemma as were value theorists of the mid-1800s: They recognize that they must specify the value of nature in justifying state environmental strategy and the expansion of capital into ecosystem services but struggle with the limits of doing so by extracting elements of nature and placing them in capitalist value form. Political ecologists and others will similarly struggle to understand the basis on which capitalist states confront nature -- even as the consequences of this encounter are increasingly well documented -- without a return to value theory.