Capital II, Chapter 21 - Part 4

1) Accumulation in Department I 

1)The Formation of a Hoard 

Marx examines first the process of accumulation in Department 1. As stated previously, the situation is essentially the same as that encountered in relation to the replacement of fixed capital. Some capitals are buying without selling, and others are selling without buying.

“One part of the capitalists is continually converting its potential money-capital, grown to an appropriate size, into productive capital, i.e., with the money hoarded by the conversion of surplus-value into money they buy means of production, additional elements of constant capital. Another part of the capitalists is meanwhile still engaged in hoarding its potential money-capital. Capitalists belonging to these two categories confront each other: some as buyers, the others as sellers, and each one of the two exclusively in one of these roles.” (p 496)

In other words, some businesses are just starting up. They buy large amounts of fixed capital, and circulating capital thereby throwing large amounts of money-capital into circulation, but taking only a small amount out by comparison. They are buyers but not sellers, at least for a large proportion of what they have bought. There are other capitals, who have stored up sufficient money hoards that they now have sufficient money capital to expand their business, buying additional machines, constructing a new factory or branching out into some new type of business. They too now throw this large amount of new additional money-capital into circulation, buying all of these additional commodities as well as labour-power.

But, the commodities they throw into circulation themselves in no way are equal to the value of all these commodities they have bought. They too are buyers without being sellers. In both cases, the difference between what is bought and what is sold, the commodities withdrawn from circulation and the commodities thrown into circulation is made up by the additional money-capital thrown into circulation. But, for everything to balance out here, so that there is not a surplus or a deficit of commodities available to be bought or sold to match all of these capitals that are buyers but not sellers, there must be sellers who are not buyers. There must be capitals that throw more commodities into circulation than they take out of it, and who thereby take more money out of circulation than they throw into it, just as the former throw more money into circulation than they took out of it.

This is the key to understanding the actual process of accumulation, and given that under capitalism, this proceeds according to no plan, and not even from year to year, but via billions of individual acts of saving and spending, over different periods of time, the true complexity of the process can be grasped. As Marx comments later,

“...all these necessary premises demand one another, but they are brought about by a very complicated process, including three processes of circulation which occur independently of one another but intermingle. This process is so complicated that it offers ever so many occasions for running abnormally.” (p 500)

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