Sunday, 8 July 2018

Paul Mason's Postcapitalism - A Detailed Critique - Chapter 3 (3)

Marx and the Genesis of the New System - Socialised Capital, Credit, and Co-operatives

Paul says Marx, 

“... never explained how the sporadic crises would – or could – create the conditions for the new system.” (p 54) 

But he did, and part of the answer lies in the form of “state capitalism, monopolies, complex financial markets and globalisation” that Paul says Marx could not take into account. 

To be clear here, Marx's theory was never a crude theory about socialism arising in response to crises. The repeated crises fulfil the function of showing to workers the futility of fighting purely economistic, distributional struggles for higher wages within the existing system, but nothing more. As Marx and Engels both argue, the points in the cycle where there are crises, and more specifically the points in the cycle where there is recession and stagnation, are precisely the times when they are on the back foot.

Engels, for example says,

“The history of these Unions is a long series of defeats of the working-men, interrupted by a few isolated victories. All these efforts naturally cannot alter the economic law according to which wages are determined by the relation between supply and demand in the labour market. Hence the Unions remain powerless against all great forces which influence this relation. In a commercial crisis the Union itself must reduce wages or dissolve wholly; and in a time of considerable increase in the demand for labour, it cannot fix the rate of wages higher than would be reached spontaneously by the competition of the capitalists among themselves.” 

(The Condition of the Working Class, p 243)

As Marx says in “Value, Price and Profit”, rather than these distributional struggles, the workers should instead look to those economic and social forms that capitalism has itself provided, and develop them as its own alternative. Those forms are the forms of socialised capital – joint stock companies, and cooperatives – that Marx says in Capital III, Chapter 27, represent the transitional forms of property. In particular, the worker owned cooperatives are what Marx and the First International encouraged workers to develop. 

“We recommend to the working men to embark in co-operative production rather than in co-operative stores. The latter touch but the surface of the present economical system, the former attacks its groundwork.” 

With the joint stock companies, the shareholders exert control over the socialised capital they do not own. It requires a political struggle to remove that right from them, a struggle that was only partially undertaken in Germany with the introduction of the co-determination laws. But, with the worker owned co-operative, the workers from the start exercise that control. And, in Capital III, Chapter 27, Marx is explicit that it is on the basis of credit, and the expansion of finance that it becomes possible to expand these forms of socialised property on a national scale. 

“Without the factory system arising out of the capitalist mode of production there could have been no co-operative factories. Nor could these have developed without the credit system arising out of the same mode of production. The credit system is not only the principal basis for the gradual transformation of capitalist private enterprises into capitalist stock companies, but equally offers the means for the gradual extension of co-operative enterprises on a more or less national scale. The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other... 

The credit system appears as the main lever of over-production and over-speculation in commerce solely because the reproduction process, which is elastic by nature, is here forced to its extreme limits, and is so forced because a large part of the social capital is employed by people who do not own it and who consequently tackle things quite differently than the owner, who anxiously weighs the limitations of his private capital in so far as he handles it himself. This simply demonstrates the fact that the self-expansion of capital based on the contradictory nature of capitalist production permits an actual free development only up to a certain point, so that in fact it constitutes an immanent fetter and barrier to production, which are continually broken through by the credit system. Hence, the credit system accelerates the material development of the productive forces and the establishment of the world-market. It is the historical mission of the capitalist system of production to raise these material foundations of the new mode of production to a certain degree of perfection. At the same time credit accelerates the violent eruptions of this contradiction — crises — and thereby the elements of disintegration of the old mode of production.” 

As Marx also sets out, with Engels, in Anti-Duhring, it is precisely as a result of crises that capital becomes rapidly more concentrated and centralised into monopolies and oligopolies, the ultimate form of which is state capital. Engels says that this state capital is still capital, but by making abundantly clear the superfluous and parasitic nature of the private money-lending capitalists, who are reduced to the role of coupon clippers, it shows to the workers the solution. 

“Many of these means of production and of communication are, from the outset, so colossal that, like the railways, they exclude all other forms of capitalistic exploitation. At a certain stage of development this form, too, no longer suffices: [the large-scale producers in one and the same branch of industry in a country unite in a “trust”, an association for the purpose of regulating production.” 

(Engels, Anti-Duhring, p 358) 

“In the trusts, free competition changes into monopoly and the planless production of capitalist society capitulates before the planned production of the invading socialist society. Of course, this is initially still to the benefit of the capitalists.” 

(ibid, p 358) 

“But, the exploitation becomes so palpable here that it must break down. No nation would put up with production directed by trusts, with such a barefaced exploitation of the community by a small band of coupon clippers.” 

(ibid, p 358) 

“All the social functions of the capitalist are now performed by salaried employees. The capitalist no longer has any social activity save the pocketing of revenues, the clipping of coupons, and gambling on the Stock Exchange, where the different capitalists fleece each other of their capital. Just as at first the capitalist mode of production displaced the workers, so now it is displacing the capitalists, relegating them, just as it did the workers, to the superfluous population, although not immediately to the industrial reserve army.” 

(ibid, p 359-60) 

Where crises may facilitate such a process is where, as happened with the Lancashire textile co-operatives, the workers are enabled to take over the factories, as the value of the productive-capital is destroyed, but its use value remains intact. Something similar was seen with the Argentinian workers occupation of factories and conversion to co-operatives, for example at Zanon. Engels noted, 

“My suggestion requires the entry of the cooperatives into the existing production. One should give them land which otherwise would be exploited by capitalist means: as demanded by the Paris Commune, the workers should operate the factories shut down by the factory-owners on a cooperative basis. That is the great difference. And Marx and I never doubted that in the transition to the full communist economy we will have to use the cooperative system as an intermediate stage on a large scale.” 

This requires that workers have already gone through a process of development, and understood the path ahead, and that they have already developed things such as a co-operative federation to bring all of their individual co-operatives within its remit, and that they are class conscious enough to wage a political struggle for the kind of political and legal framework required to promote and defend these transitional forms of property, under their control. 

As Marx put it in his Inaugural Address

"To save the industrious masses, co-operative labour ought to be developed to national dimensions, and, consequently, to be fostered by national means. Yet the lords of the land and the lords of capital will always use their political privileges for the defence and perpetuation of their economic monopolies. So far from promoting, they will continue to lay every possible impediment in the way of the emancipation of labour. Remember the sneer with which, last session, Lord Palmerston put down the advocates of the Irish Tenants’ Right Bill. The House of Commons, cried he, is a house of landed proprietors. To conquer political power has, therefore, become the great duty of the working classes. They seem to have comprehended this, for in England, Germany, Italy, and France, there have taken place simultaneous revivals, and simultaneous efforts are being made at the political organization of the workingmen’s party.” 

So, I don't really understand the point that Paul was trying to make here. And, a lot of this was understood, at the time. Kautsky, whilst arguing against the revisionism of Bernstein, was also describing the way these socialised forms of property, and the development of the working-class, were creating the objective foundations of socialism. 

“The corporation renders the person of the capitalist wholly superfluous for the conduct of capitalist undertakings. The exclusion of his personality from industrial life ceases to be a question of possibility or of intention. It is purely a question of POWER. 

This preparation for Socialism through the concentration of capital is meanwhile only one side of the process of gradual growth into the future state. Along with it there is proceeding an evolution within the working class that is no less of an indication of growth in the direction of Socialism 

With the growth of capital goes also an increase in the number of proletarians within society. They become the most numerous class. Simultaneously grows their organization. The labourers create co-operatives that abolish the middle men and establish production directly for their own use. They organize unions that restrict the absolute power of the employers and exercise an influence in the productive process. They elect members to the representative bodies in the municipalities and states who seek to secure reforms, to enact legislation for the protection of labourers, to make state and municipal industries model businesses and to increase the number of such industries.” 

(The Road To Power) 

Lenin himself was proposing resolutions to the Copenhagen Congress of the Second International for the creation of co-operatives.

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