Sunday 9 May 2021

Michael Roberts and Historical Materialism - Part 12 of 12

Roberts says,

“The development of capitalism in agriculture and in trade laid the basis for the introduction of industrial technology that led to the so-called Industrial Revolution and industrial capitalism.”

Again this is back to front. Roberts and the other authors fail to explain what the material basis for an expansion of agricultural production, and change in method of production would be, unless it faced a rising demand for its output, and then needs to explain where this expanding market comes from, unless it is the product of a growth of industrial capitalist production in the towns, which creates both a demand for food, and for raw materials, as this industrial production expands. Indeed, the increased demand for wool is an indication of it. Similarly, why would there be an increase in trade, in conditions where peasant producers directly produce their own requirements, and also produce the requirements of landlords, unless that trade arises from rising demand from industrial producers in the towns?

Roberts says,

“The Industrial Revolution occurred in Britain around 1800, because “innovation was uniquely profitable then and there”.

In fact, it began in 1760, but he again fails to provide any material basis as to why innovation was uniquely profitable then and there. Marx does provide that explanation in Theories of Surplus Value. The steady growth of capitalist production in the towns from the 15th century, and of the commodity markets that goes with it, is given a boost, by the expansion of global trade, as merchant adventurers open up new trade routes in search of new sources of supply, and markets for manufactured products.

Merchant capitalists had expanded capitalist production, via the Putting Out System, and then the creation of handicraft workshops, and later manufactories. But, these largely obtained surplus value by utilising the savings from the division of labour, and economies of scale, whilst continuing to use the old handicraft methods of production. They undercut the independent handicraft producers, who are themselves then ruined and become wage labourers, in turn expanding the market for commodities. Yet, as the quote from the anonymous author above described, labour was still not cheap, because workers still retained some connection to the land, and ability to provide their means of subsistence. Indeed, as Marx describes, this initial period only sees the formal subordination of labour to capital. The artisan can still, in favourable conditions, become an independent commodity producer again. Its only when large scale machine industry develops that labour is really subordinated to capital.  Marx makes the same point in Value, Price and Profit, about the conditions facing capital initially in North America.

"As to the limits of the value of labour, its actual settlement always depends upon supply and demand, I mean the demand for labour on the part of capital, and the supply of labour by the working men. In colonial countries the law of supply and demand favours the working man. Hence the relatively high standard of wages in the United States. Capital may there try its utmost. It cannot prevent the labour market from being continuously emptied by the continuous conversion of wages labourers into independent, self-sustaining peasants. The position of a wages labourer is for a very large part of the American people but a probational state, which they are sure to leave within a longer or shorter term. To mend this colonial state of things the paternal British Government accepted for some time what is called the modern colonization theory, which consists in putting an artificial high price upon colonial land, in order to prevent the too quick conversion of the wages labourer into the independent peasant."

And, this creates the conditions under which this industrial revolution can and must occur. On the one hand, there has already developed large concentrated markets for industrial commodities in the towns; secondly, independent commodity producers have been ruined and converted into wage labourers, now employed in manufactories; thirdly the high wages of these workers creates an incentive for capital to replace this labour with machinery, and, thereby, further undercut the handicraft producers.

This is how Marx and Engels' theory of historical materialism explains the development of industrial capitalism in the towns, and its subsequent spread into agriculture, purely on the basis of the analysis of material conditions existing in society, and how those conditions lead under pressure of The Law of Value, to an expansion of commodity production, to a subsequent ruination of small independent commodity producers and their conversion to wage labourers, whilst their means of production become capital in the hands of a small group of industrial capitalists, who emerge out of the small producers themselves. It is this process which first creates capital, then capitalists, then capitalism, and ultimately also creates Socialism.

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