Class Divisions
And, of course, these divisions within the ruling-class are mirrored within the working-class too. That is why, so long as the working-class is restricted within the limits of a narrow trades union consciousness, workers employed in things such as cigarette production will always look to the threat to their jobs, and side with their employers against measures that might diminish the industry, and the same is seen in industries such as arms production, and so on. In other words, in terms of both the major classes, a general class interest is continually coming up against conflicting sectional interests.
Ask the Carillion construction workers whether the PFI contracts, which, over the last twenty years, provided them with well paid, secure employment, were a good idea, and they would undoubtedly say yes. And, of course, given that the Carillion bosses benefited from those contracts they too would find them a good idea, as would the Carillion shareholders who obtained generous dividends out of the profits. Whether these contracts were beneficial to Capital in General, in the same way that the abolition of the Corn Laws was good for Capital in General, is up for debate. However, if they were as clearly bad for Capital in General as some have suggested, as opposed to being merely beneficial to a handful of contracting companies, the question would have to be asked, why then Capital in General did not act to assert its own interests?
As I pointed out to Mike McNair,
“Actually, I agree with Marx that ultimately taxes are a deduction from Surplus Value, and so if the Capitalist State makes a bad decision on how to raise funds for investment, it actually means it has to raise taxes on Capital in general, in order to subsidise Capital in particular!
If you do not hold to Marx's view then by the same token you can argue that private Capital can reduce workers real wages by raising prices. In that case you arrive at the same position. By that token if a firm decides to raise funds for investment by borrowing from a Bank, when it would have been cheaper to simply issue shares then this higher cost would mean it produces less widgets for any given amount of Capital, hence less for workers to consume at any given price!
But, Marxists do not seek to advise individual capitalists on the best way to make profits, by advising them to issue shares rather than take out bank loans, because choosing one method would result in more commodities at lower prices being produced!”
Of course, in the short term, capital can drive wages below the value of labour-power, and in the short to medium term, it can facilitate that process by extending consumer and other forms of credit to workers, so that the workers continue to consume at the old level, so as to enable the realisation of profits. And, indeed, since the late 1980's, that is what capital, particularly in the US and UK has done, which is why household debt has skyrocketed, and huge credit fuelled asset price bubbles have been inflated. But, that only defers the operation of the laws of economics, it does not overturn them. Eventually, the workers have to not only repay the debt, but also the huge amounts of interest accumulated on the debt, and that means that their consumption of commodities is cratered, with a consequent effect on all those capitals that have produced those commodities, and now cannot sell them. Alternatively, large numbers of workers default on their debts, which results in a collapse of asset prices, and rise in interest rates, or else the workers wages have to rise to a level where not only can they reproduce their labour-power, but also they can repay their debts and the accumulated interest. Either way, the cost ultimately falls upon surplus value. There is no reason, therefore, why capital in general would acquiesce in the provision of essential services and so on, by clearly inefficient means, because that, in the end, means that it is capital in general which bears that cost out of its profits.
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