The apologists admit the possibility of an overproduction of capital, but deny the possibility of an overproduction of commodities, but capital is comprised of commodities.
“Capital itself however consists of commodities or, in so far as it consists of money, it must be reconverted into commodities of one kind or another, in order to be able to function as capital. What then does overproduction of capital mean? Over-production of value destined to produce surplus-value or, if one considers the material content, over-production of commodities destined for reproduction—that is, reproduction on too large a scale, which is the same as over-production pure and simple.” (p 533)
This also thereby relates back to the analysis of national output into capital and revenue, especially when considered in terms of expanded reproduction. Viewed in physical terms, too much has been produced, not only to reproduce the elements of constant capital, but also to produce those elements designed for accumulation. In theory, more of society's output could have been devoted to, say, luxury production (revenue), so that less went to accumulation. However, this again requires that the specific nature of capitalism be denied. It requires that the purpose of capitalism be reduced to the personal enrichment and consumption of the capitalist, whereas what drives it (even when the social role of the private capitalist has long since disappeared) is the need for accumulation, and the maximisation of profit, so as to maximise that accumulation.
Moreover, the overproduction of capital, as against revenue, is not simply a question of this physical overproduction, but overproduction from the standpoint of the ability of those elements of capital acting as capital, i.e. being able to produce surplus value. This is where Adam Smith's concept of overproduction, and a squeeze on profits is relevant. If commodities such as factories, machines, materials etc. are produced, in order to operate as capital, they must also employ labour-power. At a certain point, and particularly in certain spheres, the supplies of labour-power begin to be used up. Wages rise, and as a result, surplus value is reduced. The potential for overproduction, therefore, resides not only in the fact that commodities have been produced that do not find a market, so that their value is not realised, but also from the fact that wages can rise to a level where surplus value disappears. Even if the surplus value does not disappear, but simply gets squeezed, and, as output rises, the profit margin becomes smaller on each unit of output, any failure to sell the entire output results in a fall in market price below the cost of production, so that each unit sells at a loss.
“Defined more closely, this means nothing more than that too much has been produced for the purpose of enrichment, or that too great a part of the product is intended not for consumption as revenue, but for making more money (for accumulation): not to satisfy the personal needs of its owner, but to give him money, abstract social riches and capital, more power over the labour of others, i.e., to increase this power.” (p 533-4)
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