Tuesday, 6 October 2015

Capital III, Chapter 15 - Part 27

The rise in productivity increases the rate of turnover of capital, and results in a release of capital. Unless that capital is used for further accumulation of the existing capital, or to establish some new capital, that released capital is unemployed. But, the capital released is productive-capital, it comprises also workers who are released, unless they are employed by the investment of this released capital. So, unemployed workers are the other side of the coin to the unemployed capital. In other words, too much capital is accumulated so that a portion of it cannot act as capital, as self-expanding value. That is, instead of the accumulation of additional productive-capital producing a larger sum of surplus value, the mass of surplus value produced remains the same or falls.

But, this can be understood in a number of ways. Firstly, this situation may exist for some specific capital, but not for capital as a whole, or its main components. In which case, it represents only a partial overproduction. Or it may apply to capital as a whole or its main components, in which case it is a generalised overproduction.

In addition, the overproduction may result from capital being overproduced to an extent that the quantity of surplus value produced stops rising and may fall (in either case falling in proportion to the capital advanced to produce it) or else it may be overproduced to the extent that the surplus value produced cannot be realised.

If we analyse the underlying value relations here in terms of the production of Robinson Crusoe, and then compare that with the difference under capitalist production, this becomes clear.

We've seen some of this overproduction in relation to Robinson before. He has a 10 hour working day and spends 8 hours catching fish, i.e. producing his consumption fund (variable capital). He has 2 hours of surplus labour-time, and uses it to produce a fishing net (means of production, or constant capital). With the net, he now produces the fish he requires in just 4 hours, but must spend .25 hours maintaining his net. He then has 5.75 hours of surplus labour time available to him, and what he produces in that time is his surplus product with a surplus value equal to 5.75 hours.

Not only has his mass of surplus value risen here, by more than double, because his rate of surplus value has risen (the value of his labour-power has fallen from 8 hours to 4.25 hours) but his rate of profit has risen from 2/8 = 25%, to 5.75/4.25 = 135.29%.

However, as was seen earlier, if Robinson spends some of this additional surplus labour-time to produce another net, this may constitute overproduction for several reasons. Firstly, he may be only able to use one net at a time, so that the time he spent producing it was totally wasted. In essence, he reduced his 5.75 hours of surplus labour-time to just 3.75 hours. Secondly, he may be able to use the second net, but depending on the fish available to be caught, it may not increase his consumption fund sufficiently to justify the time spent on its production and maintenance. In other words, this is really a crisis of disproportion. Thirdly, the second net may double his production of fish, or more, but the result is that he has more fish to eat than he can stomach. He has an overproduction of commodity-capital, which cannot be realised, which means that the productive-capital used to produce that commodity-capital had itself been over accumulated.

The second net, of course, might be beneficial if the supply of labour-power is doubled with the appearance of Man Friday. This may indeed result in a beneficial expansion of total production in the quantity of use values, value and surplus value, such that the latter can again be utilised to increase the available means of production and consumption.

The other way that Robinson's expansion of his means of production could create such an overproduction is that he expands them to a degree that the time he has to spend maintaining them exceeds the additional consumption he obtains so that his available surplus labour-time shrinks. Suppose, for example, his herds increase to such a size that he requires larger and larger pens, whose maintenance becomes like painting the Forth Rail Bridge, i.e. as soon as its finished its time to start again.

But, the difference between Robinson, a peasant family, or commune, a co-operative commonwealth as against capitalism is that all of the former organise their production to maximise their consumption relative to the time required for its production. In other words, as Engels put it in the earlier quote from Anti-Duhring, each of these societies measures its production of use values against the value of those use values, i.e. the labour-time required for their production, and allocates its labour-time accordingly, in accordance with the Law of Value. They produce means of production only as a means of achieving this end. But the aim of capitalist production is not to meet the needs of consumption, but to maximise the production of surplus value. Capital only gears its production, to meet the needs of consumers to the extent that this is needed as a means of realising that surplus value.

All of the former can make a mistake in their value calculations, and overproduce in the ways previously described, but capitalism overproduces not because of any such mistake, but because it is necessarily driven to do so by the need to continually produce more surplus value, rather than to satisfy the consumption needs of society. All of the former can make a mistake in calculating the various value relations affecting their production, and the consequences of such mistakes become greater and more far reaching the larger the scale of production, for each of them, but none of them constitute the kind of crisis of overproduction that affects capitalism.

For all of the former, any such overproduction represents a crisis only to the extent that available labour-time has been used inefficiently so that potential consumption has not been maximised. Value is destroyed to the extent that labour-time has been expended on production that does not result in final consumption, either because the consumption fund is not increased, as a result, or is increased by more than is required, so that products simply go to waste.

An overproduction of consumption goods is rarely a basis of crisis for such societies, because it usually means that where such overproduction cannot be stored, for future consumption, or exchanged with some other society, for an equivalent form of value, that can be stored, it can simply be used to temporarily increase current consumption.

So, peasant communities organise feasts when they experience an unexpected surplus. The main problem is where this can't fully be achieved. For example, a large surplus of grain might not be capable of being stored, or used if there are insufficient silos, or animals to fatten, with it, or mills to grind it into flour. The USSR suffered constantly with food being destroyed for these kinds of reason.

The bigger problem for such societies is where the consumption fund is not expanded enough. This then causes real crises, because there may be famine, or other shortages that hamper future production. But, such crises are not really crises of overproduction for such societies. They are crises of disproportion with not enough social labour-time being devoted to the consumption fund, either because it is absolutely unavailable, or because too much has been devoted to the production of means of production. The former is really a problem of lack of productivity. It leads to a vicious circle. These societies try to compensate by increasing the population, but that means even more mouths to feed, and with high infant mortality rates, resources go to rearing children, who do not live long enough to produce value themselves. Value is destroyed rather than created. The latter, relatively too little labour devoted to the consumption fund, can also arise where a portion of the consumption fund of society is appropriated by unproductive members of society, so that insufficient is available to meet the consumption needs of the producers. This is particularly, a problem where productivity levels are low.

But, compare this to the situation under capitalism. Take the last point. The capitalists as unproductive members of society do not seek to reduce the size of the society's consumption fund by increasing their consumption from it. On the contrary, as Marx points out, such a conception would be to totally misunderstand the dynamic of capitalism, based on the need to accumulate capital, and to confuse it with previous modes of production like feudalism, where the exploitation by the aristocrats was driven precisely by their subjective desire to increase their conspicuous consumption.

Rather, capital seeks to maximise the portion of society's social labour-time going to the production of surplus value, because this is the means by which capital is accumulated. A larger portion of surplus value means a larger quantity of means of production can be employed, and a larger quantity of means of consumption can be produced, to reproduce a larger quantity of labour-power. At the level of each individual capital, this is manifest in the drive to maximise its own profits.

But, the contradiction here is obvious. In order to maximise the portion of total social labour-time going to surplus value, the portion going to reproduce the means of production and means of consumption being currently consumed in production, must be minimised. But, the production of each capital is either of commodities that constitute means of production or means of consumption, and each capital can only maximise its production of surplus value, by producing more of these commodities, i.e. devoting increasing amounts of labour-time to their production! This is nothing less than the basic contradiction facing capital of the problem of producing surplus value, versus realising it. Moreover, it can only realise that surplus value if it can sell the commodities it produces. The contradiction here once more revolves around an increasing mass, and a relatively declining relative proportion.

No comments: