V - Accumulation in Capitalist Society
Lenin now turns to how Sismondi's errors, in relation to his adoption of Smith's absurd dogma, results in his failure to understand the nature of accumulation, and the repetition of his errors by the Narodniks. Unfortunately, Lenin's own argument is also wrong. It could be a case of Lenin “bending the stick”, in order to polemicise against his opponents, but it appears to be more a genuine theoretical error arising from not having access to Marx's writings in Theories of Surplus Value, in which these arguments are developed.
So, Lenin says,
“Sismondi did not in the least understand capitalist accumulation, and in his heated controversy on this subject with Ricardo truth was really on the side of the latter. Ricardo asserted that production creates a market for itself, whereas Sismondi denied this, and based his theory of crises on this denial.” (p 154-5)
But, as Marx sets out in Theories of Surplus Value, Chapter 17, truth most certainly was not absolutely on the side of Ricardo, who, as against Sismondi, fell into the trap of Say's Law. Ricardo's argument is an acceptance and repetition of Say's Law, actually developed by James Mill that supply creates its own demand, or in Lenin's terminology production creates its own market. Marx flatly denies this assertion, which was the basis of Mill, Say and Ricardo's assertion that a generalised overproduction of commodities was impossible.
“... No man produces, but with a view to consume or sell, and he never sells, but with an intention to purchase some other commodity, which may be immediately useful to him, or which may contribute to future production. By producing, then, he necessarily becomes either the consumer of his own goods, or the purchaser and consumer of the goods of some other person. It is not to be supposed that he should, for any length of time, be ill-informed of the commodities which he can most advantageously produce, to attain the object which he has in view, namely, the possession of other goods; and, therefore, it is not probable that he will continually” (the point in question here is not eternal life) “produce a commodity for which there is no demand.” ([David Ricardo, On the Principles of Political Economy, and Taxation, London, 1821,] pp. 339-40.)”
(Theories of Surplus Value 2, p 493-4)
and,
““Productions are always bought by productions, or by services; money is only the medium by which the exchange is effected” (l.c., p. 341).”
(Theories of Surplus Value 2, p 501)
But, of course, the whole point of commodity production is that it is production not for consumption, but for the production of exchange value, and in particular surplus exchange value. The capitalist producer does not produce millions of units of some commodity either for their own consumption or anyone else's. The only reason they produce a commodity that meets someone else's needs, is because that is the only way it can be sold, and the exchange value realised. Moreover, in realising that exchange value, their purpose is not, thereby, to satisfy their own consumption needs by using the exchange value to buy other commodities. It is to buy additional elements of productive capital, and, thereby, to produce even more commodities, which realise even more exchange value, which they use to accumulate more capital and so on. Moreover, the nature of competition, within commodity production, drives each producer to produce in the most efficient manner, which increasingly means on an ever larger scale.
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