Capital III, Chapter 15 - Part 39

Although technology has revolutionised productivity, instead of this going to ensure that every worker has sufficient resources to be able to produce effectively, and so to lessen their working times, the means of production are restricted to relatively fewer workers, who if anything have to work longer. The proposal to extend the retirement age in Britain being a clear example of that. And, whilst these workers have to work for longer, and more intensively, the other side is high levels of unemployment and under employment, particularly amongst young workers.

“In the second place, not enough means of production are produced to permit the employment of the entire able-bodied population under the most productive conditions, so that their absolute working period could be shortened by the mass and effectiveness of the constant capital employed during working-hours.” (p 258)

When too many means of production are produced, this is not in the sense of Robinson Crusoe producing a fishing net he could not use, but in the sense that if workers were to be employed to use these means of production, the increased demand for labour-power would push up wages, and reduce the rate of surplus value.

“On the other hand, too many means of labour and necessities of life are produced at times to permit of their serving as means for the exploitation of labourers at a certain rate of profit.” (p 258)

Even when workers have produced this surplus value, too many commodities are produced for this surplus value to be realised, because this increased mass of use values, dumped on the market, comes up against the limitations of the market, in the shape of limited consumer demand for that quantity of those particular use values.

“Too many commodities are produced to permit of a realisation and conversion into new capital of the value and surplus-value contained in them under the conditions of distribution and consumption peculiar to capitalist production, i.e., too many to permit of the consummation of this process without constantly recurring explosions.” (p 258)

Its not that too much wealth has been created,

“But at times too much wealth is produced in its capitalistic, self-contradictory forms.” (p 258)

That is because of the limitations of capitalism as a mode of production.

1. Each capital is driven by competition. Competition causes each firm to constantly revolutionise its productivity. Social productivity, therefore, constantly rises. The consequence of constantly rising social productivity is that the rate of profit, i.e. here essentially the profit margin, on each commodity unit, constantly falls, aside from the countervailing forces, which cause it to rise.
   
   The ever lower profit margin per unit, means that production is increasingly susceptible to becoming unprofitable. That is true, even as the mass of profit, and annual rate of profit rise. The rising social productivity is also manifest in the constantly expanding mass of use values dumped in the market. The more this mass increases, the more it meets consumer resistance. The more chance then, given the diminished profit margin, that market price may fall below the market value, making production of these commodity units unprofitable, and preventing the producer from reproducing their capital, and possibly leading to a payments crisis.
   
2. The extent to which production can be expanded, or has to contract, is a function of the rate of profit – if we leave aside the use of credit, or the mobilisation of additional means of primary accumulation, for capital formation.

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