Wednesday 9 January 2019

Theories of Surplus Value, Part III, Chapter 20 - Part 19

That the early economists, analysing the start of capitalist production should continue to view the relation between wage-labour and capital, as still one between commodity owners was understandable, but the attempts by Mill and later economists to continue to frame the exchange in these terms, stems only from a desire to reconcile the contradictions in the Ricardian theory, and the obvious reality that what the workers were being paid in wages was not equal to the value of their production, and was then a breach of the Law of Value. 

Mill's problem then is to explain this obvious contradiction that if the worker is a commodity owner, selling the product of their labour, to the capitalist, why is it that their wages are not equal to this value

““Instead, however, of waiting till the commodity is produced, and […] the value of it is realised, it has been found to suit much better the convenience of the labourers to receive their share in advance. The shape under which it has been found most convenient for all parties that they should receive it, is that of wages. When the share of the commodity which belongs to the labourer has been all received in the shape of wages, the commodity itself belongs to the capitalist, he having, in reality, bought the share of the labourer and paid for it in advance” ( [James Mill, Elements of Political Economy, second ed., 1824, p. 41] Elémens d’économie politique, traduit de l’anglais par J. T. Parisot, Paris, 1823, pp. 33-34).” (p 88-9) 

Its typical of Mill, Marx says, that he views such developments in terms of “convenience”, so, for example, for Mill, money arises simply on the basis that it is convenient. It is a kind of functionalism, whereby society is viewed as some kind of machine, and all its components and relations are merely developed on the basis that they perform some function within it. Wages are then simply a convenient way for the workers to be paid for their product, by the capitalist. There is no comprehension that these social relations arise on the basis of unequal power between the various participants, and that this unequal power is itself the product of material conditions. In Mill's conception, it may as well be said that the relation between the slave and slave owner arises, because it has been found to be a convenient arrangement for them both. 

Of course, the relation between wage-labour and capital can no more be explained on the basis of some kind of functional convenience than can that between master and slave, or serf and feudal lord. Rather, it arises on the back of conditions of domination and subordination. At least in the first instance, the independent commodity producer does not simply choose to become a wage worker on the basis of convenience. The independent producers, who become employed under the Putting Out System, did so only as a last resort, usually because, for one reason or another, they had landed in debt, and were no longer able to buy the materials required, so as to engage in their own independent commodity production. 

“Commodities and money are transformed into capital because the worker has ceased to engage in exchange as a commodity producer and commodity owner; instead of selling commodities he is compelled to sell his labour itself (to sell directly his labour-power) as a commodity to the owner of the objective conditions of labour. This separation is the prerequisite for the relationship of capital and wage-labour in the same way as it is the prerequisite for the transformation of money (or of the commodities by which it is represented) into capital.” (p 89) 

As Marx described in Capital I, it was also the case that many workers, in Europe, took the opportunity of emigrating to the US and other colonies, where they could obtain land cheaply, and thereby turn themselves back into independent peasant producers. That also illustrates the naivete, and for some bourgeois apologists today, the dishonesty, of the idea that wage-labour and capital is based upon some sense of a convenient arrangement between the two, with the world being divided into two types of people – the capitalist prepared to take risks, endure inconvenience and so on, and the rest who are happy to settle for the convenience of a regular wage. However, in today's world, in which large scale industrial capital dominates, resting upon high levels of productivity, and relative surplus value, it is also the case that in many parts of the world, peasant producers, or at least their children, do migrate to the towns to become wage workers, because, even with high rates of exploitation, the living standard of wage workers is higher than that of the peasant producer. 

In the developed world too, the independent, self-employed worker, and even small capitalist, cannot compete with large-scale industrial capital. The majority of self-employed workers become so, because of the inability to obtain permanent employment as wage workers. Their living standard is often lower than that of a wage worker in the same job. 

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