What Lenin's analysis shows is that the buyers-up, in Russia, were not simply merchants operating in the sphere of distribution, but were large-scale capitalist producers, operating via the Putting Out System, to employ large amounts of wage labour. In other words, the same process described by Marx and Engels, in Capital, was occurring in Russia too. Merchants, who provided materials to independent commodity producers, began to put work out to those producers, supplying them with material, and buying up the finished product at prices that essentially represented only a wage for the added labour. They, thereby, appropriated not only their previous commercial profit, but now, also the surplus value created in production by he producer's labour. Some of the buyer-up also became, or already were, large-scale producers themselves, operating factories alongside the putting out of work to these domestic producers. The people's production that the Narodniks presented as being the basis of some alternative path of development, avoiding the inevitability of capitalism, was itself already dominated by capital.
The data in the census facilitated the analysis, because it separated out, into the third sub-group, these handicraft producers who worked for buyers-up.
“But this advantage is outweighed by the great number of omissions and uninvestigated factors, which rather seriously complicates our inquiry. No data are available on the number of buyers-up, on large buyers-up and small, on their ties with the well-to-do handicraftsmen (ties of origin, ties between the commercial operations of the buyer-up and production in his workshop, etc.), on the business of the buyer-up. The Narodnik prejudice of treating the buyer-up as extraneous prevented most investigators of handicraft industry from examining business done by buyers-up, although this is obviously a prime and principal question for the economist.” (p 422-3)
Lenin sets out that, for a detailed study, there are a number of requirements, such as investigation of how the buyers-up' capital is formed, how it operates in buying material and selling the finished product, what social relations exist, what expenses are involved, and how these differ from those of purely merchant capital, the volume of trade, the conditions in which processing is done partly in the workshop partly domestically.
“A comparison should be made between the cost of production of an article turned out by a small handicraftsman, by a large producer in a workshop where several wage-workers are employed, and by a buyer-up who gives out material to be worked up by domestic workers. The unit of investigation should be each enterprise, that is, each separate buyer-up, and it is necessary to determine the amount of his turnover, the number of persons working for him in his workshop or workshops, or in their own homes, the number of workers he employs to acquire raw materials, to store them and the finished product, and to sell the latter. A comparison should be made between the technique of production (number and quality of implements and fixtures, division of labour, etc.) used by the small master, the workshop owner who employs wage-workers, and by the buyer-up. Only such an economic investigation can give an exact scientific answer to the questions: what is a buyer-up, what is his significance in the economic process and in the historical development of the forms of industry under commodity production.” (p 423)
But, the Narodniks failure to undertake such data collection and analysis, in the house to house census, was a serious omission. Instead, the Narodniks focused on the exploitation of the producers by “kulaks” purely on the basis of commercial exploitation, i.e. from the perspective of unequal exchange relations. The same is seen, today, in the arguments of the petty-bourgeois “anti-imperialists” who focus on the unequal exchange relations between centre and periphery, thereby, avoiding analysis of the actual basis of exploitation by capital of wage labour, within each country – centre or periphery. Instead of the relation being the exploitation of labour by capital, it becomes the exploitation of periphery country A (thereby lumping together the workers and capitalists within it) by imperialist country B.
The Narodniks presented this as,
““the source of the exploitation of labour . . . lies in the function of exchange, and not in the function of production” (101); or what we often meet with in the handicraft industries is not the “capitalisation of production,” but the “capitalisation of the process of exchange” (265).” (p 424)
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