Capital II, Chapter 21 - Part 11

3) The Additional Variable Capital

Marx deals with this issue rather summarily. In Volume I, it was shown that capital always finds the labour-power it requires. It can draw on the reserve army of labour; it can increase the length or intensity of the working day (even if it has to pay more in overtime or other enhanced payments to do so); it can introduce machines to raise labour productivity and so on.

What Marx does not deal with here, but perhaps should have done, is not the availability of this labour-power, but the availability of the additional means of subsistence implied by the employment of this labour-power. Workers paid wages for the first time, or paid more wages, spend them buying means of subsistence, which means society has to devote more social labour-time to that production. Marx deals with this later in looking at accumulation in Department II.

The consequence can be seen from the huge increase in the global workforce, arising from the current Long Wave Boom – around 500 million additional workers, according to the ILO, in the first decade of the 21^st century – that has brought about a large increase in demand, globally, for food and consumer goods.

In addition to Labour-power always being available, it was shown, in Volume I, that, within limits, production can be increased without additional factories, machines and other instruments of labour. But, nearly all such increases still require an increase in the circulating capital advanced for materials to be processed.

In fact, it can be seen that the limiting factor is not the availability of money, but the availability of capital, and of social labour-time. The latter is only a manifestation of the Law of Value as it affects every mode of production, and of how it affects capitalism, in particular.

If we take the gold producer, for example, they have immediately, in their own surplus product, the means by which to employ additional labour-power and additional constant capital without the need to sell their output. A proportion of their gold surplus can immediately be paid as gold-money wages to additional workers, or for existing workers to work longer hours. It can also immediately be used to buy the extra elements of constant capital required. But, the question is, will there be sufficient additional means of subsistence for workers to buy with those additional wages, will there be sufficient additional commodities available as elements of constant capital? Marx does not ask or deal with these questions here.

A look at the experience of the current Long Wave Boom shows that, from its inception, around 1999, the increased demand for raw materials has caused global prices for them to rise sharply, as supply struggled to match demand. Similarly, the 30% increase in the size of the global working class, caused its demands for food and other consumer goods to rise. As food production struggled to rise to match increased demand, global food prices rose sharply. Other consumer goods prices did not rise, because some of the same forces that generated the new boom, i.e. significant rises in productivity, created by the introduction of new technology, sharply increased the volume of such use values brought to market, and likewise reduced their individual values. In all of the production of goods and services in Man's entire history, 25% occurred in the first decade of this century, such has been the massive increase in productive potential.

The answer to the questions above, and which Marx only gives later, in examining accumulation in Department II, is that extended production means that certainly more means of subsistence, as well as production, will become available, on the basis so far outlined, and on the basis Marx turns to next, in relation to Department II, but there is no guarantee that they will increase sufficiently to meet all the needs for expansion. It is quite likely then that a crisis of disproportion can develop, and certain that short-term imbalances will only be dealt with by fluctuations of market prices above and below the price of production.

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