Tuesday, 18 August 2015

Capital III, Chapter 13 - Part 6

Underlying Marx's simplifying assumption of a steadily rising organic composition of capital, however, is the valid observation that the social productivity of labour steadily rises. A given number of workers progressively produces a constantly increasing volume of use values. The reason this is possible is that, for a whole range of commodities, the use of more, and progressively improved, machines raises the productivity of those workers, i.e. each worker is able to process increased volumes of material into an increased number of products.

But, even this is not as straightforward as it seems. Marx's other simplifying assumption about this process is that the increasing use of machines brings about a progressive deskilling of labour down to that of an homogeneous simple labour. But, again, Marx knew this was a contradictory process. Alongside this process also goes the need for an increasing number of technical workers, to develop and produce the machines etc. In fact, later in Capital III, although Marx anticipates the continued decimation of the petty producers, and even the small capitalists, he also sees the progressive growth of a middle class made up of these technicians etc.

Moreover, if we look at large sections of capital today, it requires workers with much higher levels of education than was required by unskilled workers in Marx's day. In fact, that is one reason capital developed the Welfare State. In that case, how valid is it to compare the labour-time provided by workers in one period with those of another, when, in fact, they may stand in relation to each other as complex labour to simple labour. In that case, fewer workers may actually provide more abstract labour-time than a larger number of their predecessors, so that what appears as a rising organic composition is not. Can we really say that the labour of a computer programmer, sitting at their PC, produces only the same amount of value in an hour, as the 19th century machine minder attending a single machine?

All of the caveats above being taken into consideration, however, it remains the case that, over long periods, the tendency of capitalist production will be that the quantity of c will rise relative to the quantity of v, and so with no changes in productivity, the value of c will rise relative to v, which, if the rate of surplus value remains constant, means that c will rise relative to s too. Put another way, s will fall relative to c, and also relative to c+v. The rate of profit will fall.

But, as Marx points out, these assumptions cannot stand either. The whole basis of the assumption Marx has just set out, is precisely that the productivity of social labour rises – more use values are produced with increasingly smaller amounts of living labour. But, on that basis, its clear that although the quantity of c may rise, relative to v, the value of c may rise, fall or remain the same, relative to v, depending on how the price of production of means of production moves relative to the price of production of wage goods. Even if the price of means of production rises relative to the price of wage goods, so that c rises relative to v, this may not signify a fall in the rate of profit, because any fall in the price of wage goods will reduce v relative to s, so that the rate of surplus value rises. A rise in the rate of surplus value combined with a fall in the value of means of production – even with a rising technical composition – may result in the rate of profit rising not falling. The determining relation here then is not the relation of c/v, but the relation of c to the new value created by labour, i.e. to v+s. Not only, might s rise relative to v, but v+s itself might rise, if the value of the product of labour rises.

As Marx points out, the very factors which create the tendency towards a falling rate of profit, are the very same factors which also lead to a reduction in the value of commodities, including means of production and consumption, and, therefore, which simultaneously act to reduce the value of constant capital and raise the rate of surplus value, thereby raising the rate of profit! In short, it is only if we abstract from the reality of capitalist production that we can understand the underlying tendency of this rising social productivity of labour, to lead to a falling rate of profit. That is no different to Marx’s method of illustrating such laws as abstractions elsewhere, before then illustrating how these laws manifest themselves in the real world, in ways which are frequently completely different, and often as inversions of the underlying tendency.

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