The Poverty of Philosophy is one of Marx's most important theoretical works. It was published in July 1847, in response to The Philosophy of Poverty, by J.P Proudhon. Marx had stayed with Proudhon, in Paris, for some time, following his exile from Germany, and Marx relates his efforts at trying to explain the dialectical method to him. It was an effort that failed.
Proudhon was, at the time, the most prominent French socialist, but his ideology, like a lot of socialist ideology of the time, was actually petty-bourgeois. As Engels describes in his History of the Communist League, many of those involved in socialist organisations, of the time, were themselves petty-bourgeois, small producers with a view of becoming small masters themselves. In many ways the same applies, today, with the vast majority of members of “Marxist” sects being students, or former students, still orbiting that milieu. These workers were both the better educated, and more affluent workers, and so better able to absorb socialist ideas, and devote time to organisation and political activity, as well as being that section of society most aware of their impending descent into the ranks of the proletariat, as their handicraft production could not compete with large-scale, capitalist, machine industry.
This kind of petty-bourgeois socialism is described, by Marx, and Engels, in relation to Sismondi, in The Communist Manifesto, and elsewhere. In essence, it sought to hold back, or reverse, the development of capitalist production, but to retain an economy based upon small scale, commodity production and exchange. Its not surprising that, today, a petty-bourgeois Left based upon a studentist/intellectual milieu, similarly adopts a reactionary “anti-capitalist” ideology, whilst its focus for the future society is one in which it is the state that acts as vehicle of change (nationalisation, planning and so on), in which, inevitably, the role of a professional bureaucracy, drawn from the ranks of the intelligentsia, plays a central role, rather than the independent activity, and self-government of the working-class.
Marx and Engels returned to the critique of these ideas in Anti-Duhring, and Lenin took up the baton in his writing, opposing the economic romanticism of the Narodniks, who transplanted the ideas of Sismondi, Proudhon and Duhring to the Russian soil. As Marx, Engels and Lenin describe, commodity production and exchange has an inevitable logic that leads to capitalist production, and large scale machine industry.
Modern Man has been around for about 200,000 years. For much of that time, s/he engaged only in production of use-values for direct consumption. Nomadic tribes, at certain times, exchanged products with other tribes, as wedding and other gifts, at rituals and ceremonies. Over long periods of time, these exchanges grew into a regular trade, and what, originally, were surplus, or highly prized products, began to be produced, by the tribes, and more settled communities, specifically to be traded. They become commodities, and, at this point, where they are produced specifically for this purpose, the cost of their production, i.e. the labour required for their production, becomes of prime concern.
If you are producing a commodity specifically to exchange it, as against simply exchanging accidentally surplus products, the point of doing so is to try to get more in exchange than you give, or, at the least, not to get less. All of these primitive communities knew how much labour-time was required for the commodities they produced, i.e. their individual value. They had used that knowledge in allocating their own available labour-time to maximise the production of the use values required for their own consumption, and developed a social division of labour on the basis of it. They also had knowledge of the time required to produce many of the use-values they required, and one reason for specialising in producing one type of commodity, rather than another, was precisely to obtain a comparative advantage from the exchange.
But, there were numerous tribes producing each type of commodity, and wanting to exchange them. Competition, thereby, aggregates the individual values of all these commodities (of the same type) into an average market value, which determines its proportional relation (exchange value) to other commodities. As Marx describes, in Capital, the fact that each tribe/community appoints a merchant to represent them, in such exchanges, meant that they played an important role in establishing these average market values. As Marx describes in A Contribution To The Critique of Political Economy, these commodity exchanges remained something that occurred on the borders between tribes/communities, for a long time, rather than being a feature within communities.
It is only when the old primitive communes begin to dissolve, and in its place arises the family, private property and the state, that commodity production and exchange begins to develop within the community. The development of settled agriculture brings a rise in agricultural productivity. Marx notes in Theories of Surplus Value, that the Physiocrats were right in saying that this is the foundation of all wealth. If labour is fully occupied in agricultural production, there is no surplus agricultural product, no capacity to allow some members of society to devote their time to some separate industrial production.
The rise in agricultural productivity, arising from settled agriculture, changed that condition. It meant that, say, 80-90% of the population could be employed in agriculture, and produce 100% of society's agricultural needs. By the same token, 10% of the population could leave agricultural production, as their main activity, and devote their time to industrial production, as artisans, and small independent commodity producers. They could become blacksmiths, goldsmiths, tailors, shoemakers, brewers, and so on. These industrial producers, now, needed to exchange these commodities for food, and other agricultural products. A market arises.
The industrial producers become concentrated in towns, where the markets are also developed, and where a merchant class becomes established, giving rise to the birth of the urban bourgeoisie. Eventually, over a long period of time, these towns and markets grow to a size whereby it becomes possible to produce on a large-scale, to obtain economies of scale, and so undercut competitors. Merchants, and the more efficient industrial producers take over the means of production of their failed neighbours, and employ them as wage labourers, thereby, directly appropriating surplus value from their labour. Means of production become capital.
This capitalist industrial production undermines the cottage industry undertaken by peasants to supplement their agricultural production. They are increasingly ruined, and turned also into day labourers, whilst their land and means of production is bought up by landlords, wealthier peasants, and even urban capitalists, who, now, introduce capital into agriculture. The small commodity producers are, thereby, destroyed the very competition that is inherent to commodity production and exchange, and it leads inexorably to the development of capital.
Moreover, as Marx describes, in Capital I, this same process leads inevitably to a continued centralisation and concentration of capital, so that the small private capitalists are devoured by the bigger private capitalists, and then the big private capitalists are devoured by the mammoth socialised capitals, the property of associated producers, i.e. the expropriators are expropriated by the corporations and cooperatives that represent this transitional form of property between capitalism and socialism.
So, when the petty-bourgeois socialists proclaim themselves as “anti-capitalist”, and seek to retard or reverse this process of capitalist development, and domination of this large-scale socialised capital, they are promoting reactionary and utopian ideals, the ideals of the small producer, not the proletariat. The interests of the proletariat resides not in reactionary “anti-capitalist” ideas of holding back or constraining capitalist development, but of urging it on, enhancing the contradictions inherent within it, and most important of these contradictions, the development of the working-class as the representative of its progressive tendencies, and agent of its transcendence to a new mode of production.
It is the working-class, as the associated producers, who are the collective owners of socialised capital, who are its representatives, and means of establishing democratic control over it, first within the enterprise, and, then, within society, and so to begin the long process of transforming it from being socialised capital into once more just means of production, used to facilitate the satisfaction of human needs and desires.
Despite the importance of this work, it was never republished in Marx's lifetime. Given the time it was written, prior to Marx completing his economic studies, some of the formulations are wrong, such as the description of the sale of labour rather than labour-power. Marx did make amendments to the work, and these, along with other corrections, were introduced by Engels in his 1885 German Edition. Engels also intended a second French translation, and drew up a list of alterations and corrections for it, but he never published it, the task falling to Marx's daughter Laura, who published it in 1896.
I am working from the 1976 Progress Publishers Edition of the work, which includes these revisions.
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