Sunday, 23 August 2015

Capital III, Chapter 13 - Part 10

Despite a huge fall in the rate of profit, the amount of profit and, therefore, potentially of accumulation increases significantly.

“The number of labourers employed by capital, hence the absolute mass of the labour set in motion by it, and therefore the absolute mass of surplus-labour absorbed by it, the mass of the surplus-value produced by it, and therefore the absolute mass of the profit produced by it, can, consequently, increase, and increase progressively, in spite of the progressive drop in the rate of profit. And this not only can be so. Aside from temporary fluctuations it must be so, on the basis of capitalist production.” (p 218)

In fact, the process of capitalist production is inconceivable without this growing mass of capital, and of profits, i.e. without accumulation. But, this very process of accumulation is also filled with dialectical contradictions. The mass of use values, be they means of production or means of consumption, that need simply to be reproduced, in order that society should maintain its current level of production and consumption, continues to grow larger.

In order that capital can be accumulated, additional labour-power must be employed. Given any existing technical composition of capital, the quantity of labour to be employed, is not determined by the value of the means of production, but only by its physical quantity.

“And the additional labour, through whose appropriation this additional wealth can be reconverted into capital, does not depend on the value, but on the mass of these means of production (including means of subsistence), because in the production process the labourers have nothing to do with the value, but with the use-value, of the means of production.” (p 218)

But, the value of the means of production and consumption continue to fall, because of that same law of the increasing productivity of social labour that stands behind the fall in the rate of profit. As the value of means of production falls, so any given amount of surplus value can accumulate more of them, and so the demand for additional labour-power rises. As the value of means of consumption falls, so the rate of surplus value rises, so that more surplus value is available for accumulation.

“Accumulation itself, however, and the concentration of capital that goes with it, is a material means of increasing productiveness.” (p 218)

If wage goods fall in value and workers real wages rise, this may cause them to marry earlier, have more children etc. so that the working population will rise to meet the needs of capital for additional workers. It may even exceed it, creating a surplus working population. This was more likely in Marx’s time, prior to effective family planning, and the improvement in infant mortality rates. In fact, all experience, across the globe, is that as real incomes rise, family sizes decline.

But, capital has many ways of providing the labour-power it requires. Women and children can be brought into the workforce; workers can be imported from other countries; where they exist, peasants can be brought into the towns, but, more importantly, capital can introduce new machines that replace existing workers and raise productivity, so that output can be increased with less demand for additional workers.

“It therefore follows of itself from the nature of the capitalist process of accumulation, which is but one facet of the capitalist production process, that the increased mass of means of production that is to be converted into capital always finds a correspondingly increased, even excessive, exploitable worker population. As the process of production and accumulation advances therefore, the mass of available and appropriated surplus-labour, and hence the absolute mass of profit appropriated by the social capital, must grow.” (p 218-9)

Marx then comments,

“We shall entirely ignore here that with the advance of capitalist production and the attendant development of the productiveness of social labour and multiplication of production branches, hence products, the same amount of value represents a progressively increasing mass of use-values and enjoyments.” (p 219)

However, as stated earlier, such a course is very misleading, because it is precisely this ever expanding range of use values that is one of the fundamental reasons that the rate of profit does not continually fall, because each of these new use values tends to be produced with a much lower organic composition of capital, and higher rate of profit than existing commodities, and thereby acts to raise the general rate of profit.

This process of accumulation also creates the conditions of the concentration and centralisation of capital, analysed in Capital I. Each individual firm must, on average, continue to increase in size, mobilising ever greater numbers of workers, quantities of material and of fixed capital. In the early phases of this process, the direct producers are expropriated, and alongside the expansion of capital goes an increase, though in smaller proportion, of the number of capitalists, who exert a monopoly of private capital.

As the process continues, even the smaller capitalists are expropriated, until capital expands to such a degree that the monopoly of private capital, even in the hands of the largest private capitalists, acts as a fetter on its further development. At this point, “the expropriators are expropriated”, the monopoly of private capital has to give way to socialised capital in the form of the joint stock company, co-op, the trusts, giant corporations, and the capitalist state itself. But, each of these, except the worker-owned co-op, simply replicates the growing control of capital into an increasingly smaller number of hands, even where its ownership appears to be dispersed into an ever larger number of hands. State capital is the epitome of that contradiction.

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