So, does this mean that capitalism is naturally evolving into Socialism, and so all that is required is to sit back and allow it to unfold. That was what the revisionists like Bernstein believed. It is the basis of reformism. But, of course, alongside this development is also its opposite, the development of capital. The fact that private capital ceases to exist as the dominant form in production – large amounts of private capital, of course continues to exist in production, but only in the form of the plethora of small capital, which is subordinated to big capital – does not mean that capital itself ceases to exist. The socialised capital, even as the collective property of the workers is still capital. As Marx describes in relation to the worker owned cooperative.
“The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour.”
(Capital III, Chapter 27)
But, more significantly the fact that private capital leaves the realm of production does not mean that it ceases to exist. Instead, it simply assumes its most perfect, most alienated form as loanable-money capital, capital which appears to self-expand without any connection to production whatsoever. The contradiction between capital and labour, therefore assumes a new form. It is a contradiction between socialised capital – collectively owned by the workers – and loanable money-capital/fictitious capital – owned by the private money-lending capitalists and channelled through the banks and financial institutions, stock exchanges and so on. This private capital also becomes ever larger, and more powerful, in conjunction with the increase in the size and power of socialised capital, and the working-class. It is via its ownership of this fictitious capital that the private capitalists now extract surplus value in the form of interest/dividends from the workers rather than directly via profits.
“It reproduces a new financial aristocracy, a new variety of parasites in the shape of promoters, speculators and simply nominal directors; a whole system of swindling and cheating by means of corporation promotion, stock issuance, and stock speculation. It is private production without the control of private property...
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. However, this expropriation appears within the capitalist system in a contradictory form, as appropriation of social property by a few; and credit lends the latter more and more the aspect of pure adventurers. Since property here exists in the form of stock, its movement and transfer become purely a result of gambling on the stock exchange, where the little fish are swallowed by the sharks and the lambs by the stock-exchange wolves. There is antagonism against the old form in the stock companies, in which social means of production appear as private property; but the conversion to the form of stock still remains ensnared in the trammels of capitalism; hence, instead of overcoming the antithesis between the character of wealth as social and as private wealth, the stock companies merely develop it in a new form.”
(ibid)
The class struggle, therefore, becomes a struggle between these two forms of property, socialised capital on the one hand and fictitious capital on the other, collectively owned productive capital v privately owned interest-bearing capital. And, so the idea that workers could simply sit back and wait for society to evolve to Socialism is not possible. A look at the way the ruling class, the top 0.01% who own all of this fictitious-capital have used their control over socialised capital to line their pockets, at the expense of the socialised capital illustrates that fact. They have taken company profits that should have been used for capital accumulation, and instead paid out ever expanding amounts of interest/dividends. According to Haldane, where dividends accounted for 10% of profits in the 1970's, today they account for 70%, and the executives, who represent the interests of these shareholders, have found other ways to hand money to them, in capital transfers, measures to boost share prices by selling bonds to raise money to pay dividends or buy back shares, and so on.
Similarly, the representatives of that class within the state and central banks have been equally prepared to destroy the real economy in order to protect the wealth of the top 0.01%. They have destroyed currencies via QE so as to use the printed money tokens to buy bonds, so as to inflate their prices, which then feeds through into higher prices of shares and property, so as to inflate the capital gains of the owners of this fictitious capital. They have simultaneously inflicted measures of austerity to hold back economic growth so as to restrain wages and interest rates, so as again to inflate asset prices. The central issue of the class struggle, therefore, becomes the property question, the question of control over this socialised capital, and the ability of the owners of fictitious capital to still exercise control over property they do not own, thereby enabling them to line their pockets at the workers expense.
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