Theories of Surplus Value, Part II, Chapter 8 - Part 50

[8. The Kernel of Truth in the Law Distorted by Rodbertus]

Marx summarises six errors, or “pieces of nonsense”, in Rodbertus' theory.

1. His omission of absolute surplus value as a means of raising the rate of surplus value.
2. His failure to treat the value of machinery as a “constant part of value”.
3. That he does not treat machinery used in agriculture in the same way he treats materials used in manufacture, and does not charge back to agriculture the value of the material used in the machine production.
4. That raw materials enter the costs of all industries, whereas that is not the case in transport or extractive industries, where it is only auxiliary materials that enter such costs.
5. That he fails to recognise that whilst raw material enters many areas of manufacture, the more so the production is closer to the production of items for final consumption, the other elements of constant capital becomes much smaller. As productivity rises, but the proportion of fixed capital and auxiliary materials shrinks.
6. He confuses average prices/prices of production with values. 

Stripped of all this “nonsense” a kernel of truth remains in Rodbertus' ideas.

“When the raw products are sold at their values, their value stands above the average prices of the other commodities or above their own average price, this means their value is greater than the costs of production plus average profit, thus leaving an excess profit which constitutes rent. Furthermore, assuming the same rate of surplus-value, this means that the ratio of variable capital to constant capital is greater in primary production than it is, on an average, in those spheres of production which belong to industry (which does not prevent it from being higher in some branches of industry than it is in agriculture).” (p 93)

Marx's comment that “their value stands above the average prices of the other commodities” is actually meaningless. The value of any commodity may be above or below the value or average price/price of production of other commodities, because all contain different amounts of value, require different amounts of labour-time for their production. What Marx really wanted to say is simply what he then says, which is that the value of these raw products is higher than their price of production, and so then produce surplus profit and rent.

The reason is that the organic composition of capital is generally lower for this production.

“This would therefore only be an application of the law developed by me in a general form to a particular branch of industry.” (p 93)

In other words, The Law of The Tendency For the Rate of Profit to Fall, as the organic composition of capital rises. To explain agricultural ground-rent, it is necessary to show that the organic composition of capital in agriculture is generally lower than in manufacturing. This seems prima facie to be the case, because a reliance on manual labour seems more apparent in agriculture, and capitalism had developed manufacturing more rapidly. But, Marx says,

“This point 1 appears certain to apply to agriculture on an average, because manual labour is still relatively dominant in it and it is characteristic of the bourgeois mode of production to develop manufacture more rapidly than agriculture. This is, however, a historical difference which can disappear.” (p 93)

And, indeed, in the last century, agriculture has become much more capital intensive, replacing labour on a huge scale. The increasingly intensive nature of agriculture went along with its extensive development, and was in some senses, conditional on it. It was the opening up of the North American prairies that facilitated the creation of huge industrial farms, and it was only the scale which made the development of powerful and complex pieces of machinery, such as the combined harvester, worthwhile. It has been furthered by the introduction of satellite navigation and GPS systems, that now can control such machines, even without the need for machine operators; it has made possible the use of science for fertilisers, seeds, and genetic modifications of crops, the use of aircraft for crop dusting, and so on, that would not be practical on smaller scales. 

Similarly, the opening up of those North American lands and the South American pampas, made possible cattle production on a huge scale, all connected to industrialised food processing industries. Similar processes have increased the rate of turnover of agricultural capital, as witnessed by the introduction of the Safrinha and additional harvests in Brazil, which reduces production time, and thereby reduces the amount of labour to constant capital.

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