Concern about the absence of markets arose, in Russia, Lenin says, when some branches of Russian industry reached a stage when they needed to look for foreign markets for their output, and was “nothing more than a thinly disguised manoeuvre of our capitalists, who in this way exert pressure on policy, identify (in humble avowal of their own “impotence”) the interests of their pockets with the interests of the “country” and are capable of making the government pursue a policy of colonial conquest, and even of involving it in war for the sake of protecting such “state” interests. The bottomless pit of Narodnik utopianism and Narodnik simplicity is needed for the acceptance of this wailing about markets—these crocodile tears of a quite firmly established and already conceited bourgeoisie— as proof of the “impotence” of Russian capitalism!” (p 102)
The second conclusion is that the “immiseration” of the peasantry was not an impediment to the expansion of the market, but an expression of it. The expansion of the market required that labourers be “freed” so as to become wage workers who now instead of supplying their needs via direct production bought them in the market, and whose means of production became centralised in the hands of the capitalist producers, who produced those commodities, which were then bought in the market.
“This is the only explanation of the fact that the mass expropriation of our peasantry in the post-Reform epoch has been accompanied by an increase and not a decrease in the gross productivity of the country and by the growth of the home market: it is a known fact that there has been an enormous increase in the output of the big factories and works and that there has been a considerable extension of the handicraft industries—both work mainly for the home market—and there has been a similar increase in the amount of grain circulating in the home markets (the development of the grain trade within the country).” (p 103-4)
Lenin had pointed out, earlier, that the table was inadequate, because it did not include the accumulation of capital. This has to be corrected for Lenin's third conclusion. Lenin's formulation is not quite right, here, compared to Marx's description of primary accumulation of capital, as set out in Theories of Surplus Value, Chapter 24. Marx says, there, that this primary accumulation does not require the creation of additional means of production (constant capital) or subsistence (variable capital). It only requires that those already in existence be centralised at certain points. Merchants who become productive capitalists, via the Putting-Out System, do not require additional means of production or consumption. The peasant textile producer has their own tools, which they continue to use. The difference is that the merchant, instead of selling material to the producer, and then buying the final product from them, now supplies the material without charge, and then pays the labourer only a wage for the labour they provide.
The same is true with handicraft production and manufacture. The labourers essentially continue to use their own tools, and initially operate as individual labourers, but now within the workshop or manufactory. Its here that additional capital must be accumulated, because the workshop or factory must be big enough to contain all those workers, even a rudimentary rise in the productivity of labour, and division of labour means that output rises, so that accumulation of circulating constant capital must occur.
“Actually, however, capitalist society cannot exist without accumulating, for competition compels every capitalist on pain of ruin to expand production.” (p 104)
This increase in production means that other Department I capitalists must also accumulate capital so as to produce this increased quantity of means of production. The increase in production makes it possible to introduce machinery, so as to more efficiently produce on this larger scale. That means that some workers are replaced by machines, but other workers are employed to produce the machines. The machines process more material, so more labour is employed to produce this additional material and so on. This process creates the conditions discussed earlier, whereby Department I(c) grows fastest, followed by Department II(c), followed by Department II (v + s).
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