The Social Revolution and The Political Revolution
As Marx says, the development of socialised capital represents the dissolution of capital within the capitalist system itself.
“The capital, which in itself rests on a social mode of production and presupposes a social concentration of means of production and labour-power, is here directly endowed with the form of social capital (capital of directly associated individuals) as distinct from private capital, and its undertakings assume the form of social undertakings as distinct from private undertakings. It is the abolition of capital as private property within the framework of capitalist production itself...
It is the point of departure for the capitalist mode of production; its accomplishment is the goal of this production. In the last instance, it aims at the expropriation of the means of production from all individuals. With the development of social production the means of production cease to be means of private production and products of private production, and can thereafter be only means of production in the hands of associated producers, i.e., the latter's social property, much as they are their social products.”
(Capital III, Chapter 27)
A social revolution occurs when the existing set of productive relations are replaced with another; when the dominant form of property is replaced with another. Such a social revolution has occurred. The set of productive-relations based upon private capital, and a competitive market, operating via competitive prices, has been replaced by a set of productive relations based upon socialised capital, and a planned and regulated market. This social revolution is not a socialist revolution, but as with the Mercantilist period, it is a social revolution, which is based upon a transitional form of property.
This transition period, which, for want of a better term, I call social-democracy, like the mercantilist period, also has its own nascent ruling-class. In the Mercantilist period, it was the burghers, the town bourgeoisie. Under social-democracy, it is the functioning capitalist, the professional manager, technician, administrator, and bureaucrat. Under Mercantilism, that nascent ruling class, based upon the transitional form of property of the time, merchant capital, was incapable of carrying through, or sustaining, a political revolution. It attempted to do so on several occasions with support from the peasantry, but failed. When it succeeded, in the English Civil War, its inadequate social base, and level of development, led to political power being consolidated in the hands of a dictatorial leader – Cromwell.
I have, elsewhere, described the USSR as being social-democracy without the democracy. It had all of the characteristics of such a transitional society, where socialised capital was personified by a large strata of professional managers, technicians and bureaucrats. As with the English Civil War, its inadequate social base, and level of development, led to political power being consolidated in the hands of a dictatorial leader – Stalin. Had he lived, Lenin would have been forced to assume that position, or would have been swept aside by a Stalin or someone who would fulfil that function, and the same is true had Trotsky defeated Stalin in the internal struggle.
Variations on the earlier theme can be found in the Great French Revolution, the coup of Louis Bonaparte, and with Bismark in Germany, and the same can be seen with the assorted Bonapartist leaders like Bolivar that arose in South America, and in various post-colonial countries, as with Nasser in Egypt, Assad in Syria etc. In summary, the social revolution proceeds relentlessly on its way, as the development of the productive forces brings about changes in the productive relations, and the social relations arising from them, but the political revolution, required to bring the political superstructure into alignment with those new relations, is merely prolonged and fragmented.
Before the political revolution in Britain, France, Germany etc. could be successful, it required that merchant capital was supplanted by industrial capital. Even then, the British capitalist class was only able to push through that political revolution, in 1832, with the support of the proletariat, and the industrial bourgeoisie required the support of the proletariat in order to assert its dominance over the merchant and money-lending capitalists represented by the repeal of the Corn Laws. Even then the landed aristocracy remained a dominant force in parliament until the end of the 19th century, when male workers gained the vote.
A parallel situation exists today. The functioning capitalists, and all of that equivalent layer of society, of the bureaucracy of the central and local state apparatus, and of the trades unions, cooperatives etc., represent the same kind of nascent ruling class, based upon the current transitional form of property – socialised capital. But, they cannot carry through a political revolution without the support of the working-class. The reasons why this strata are reluctant to push through such a political revolution, with the assistance of the working-class have been well rehearsed, in the past, in relation to the theory of permanent revolution.
By failing to push through such a revolution, in the 1970's, the political regime of private capital was able to assert itself, and the interests of fictitious capital, against the interests of socialised capital. But, fictitious capital can never become the dominant form of property, because it cannot exist without real capital. As Marx says,
“It would be still more absurd to presume that capital would yield interest on the basis of capitalist production without performing any productive function, i.e., without creating surplus-value, of which interest is just a part; that the capitalist mode of production would run its course without capitalist production. If an untowardly large section of capitalists were to convert their capital into money-capital, the result would be a frightful depreciation of money-capital and a frightful fall in the rate of interest; many would at once face the impossibility of living on their interest, and would hence be compelled to reconvert into industrial capitalists.”
(Capital III, Chapter 23)
So, over the last thirty years that fundamental contradiction has perpetually manifested itself in the crashes of financial and property markets, so the representatives of that fictitious capital have had to resort to ever more desperate measures to resolve it, from the destruction of currencies via QE, the buying up, by the state, of worthless assets, the creation of artificial demand for astronomically overpriced property, massive subsidies to sustain unsustainable levels of rents, the nationalisation of bankrupt banks, and financial institutions, and the destruction of real capital, by the implementation of austerity, so as to restrain economic growth, the demand for labour-power, and thereby prevent rises in interest rates, which would crash asset prices.
But, all of that inevitably fails to resolve the fundamental contradiction between fictitious capital and real capital. It has simply raised that contradiction to a much more acute level, whose resolution can only come in the form of a financial and property market crash that will make that of 2008 pale by comparison.
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