Capital then is not a “thing”, such as a drill, or plough, but is a social relation. What makes a drill or a plough capital when it is used by a wage-labourer, whereas it is not when it is used by me to do DIY, or by a peasant to produce food, is that the wage labourer does not own it, and the capitalist that does will only allow the labourer to use these means of production on certain conditions, i.e. that the labourer provides hem with an amount of unpaid labour – profit.
The peasant who produces food for their own consumption, does not need permission to use their own plough, and nor do I to use my drill to put up shelves. In neither case is their consideration of whether such activity will result in a “profit”, but only that it will result in a product that will meet a consumption requirement. In these cases, the aim is the production of use values by the most efficient means, the means of production are simply employed by labour to that end.
But, for capital, this relation is reversed. The purpose of production is not consumption, but profit, and it is now the means of production (capital) that employ labour, only to that end. Indeed, as Marx describes, in Capital III, Chapter 27, that remains true when the labourers become their own capitalist, as in the worker cooperative. So long as that cooperative must operate in a capitalist economy, it must continue to act as capital. It must maximise profit so as to accumulate capital, and, thereby, remain competitive. Otherwise, it will lose market share, and go out of business.
Subjective analysis, and explanations of exploitation, therefore, of the form based upon “greedy” capitalists are wide of the mark, moralistic and unscientific. This social relation between capital and wage-labour exists whether there are private capitalist owners of industrial capital or not. So long as there is commodity production and exchange, there is a market, and a market presupposes competition, an so winners and losers. To be a winner requires capital accumulation and maximisation of profit.
“Capital also is a social relation of production. It is a bourgeois relation of production, a production relation of bourgeois society. Are not the means of subsistence, the instruments of labour, the raw materials, of which capital consists produced and accumulated under given social conditions, in definite special relations? Are they not utilised for new production, under given special conditions, in definite social relations? And is it not just this definite social character which turns the products serving for new production into capital?” (p 28-9)
What is the basis of this maximisation of profit? It comprises two elements. Firstly, the rate of surplus value (actually annual rate of surplus value), and the quantity of labour employed. The first of these is essentially a function of the level of technological development. In very primitive societies, for example, the standard of living of labourers is very low, and, yet, the amount of surplus product/value they produce is very small, because a low level of productivity means they must spend most of their working-day simply reproducing their labour-power.
The second is the quantity of labour employed, so if 100 workers are employed for 10 hours, with a 100% rate of surplus value, that gives 100 x 10 = 1,000 hours of new value, comprised of 500 hours necessary labour, and 500 hours of surplus labour. If 300 workers are employed, new value is 3,000 and even if the rate of surplus value is only 50%, that gives 1,000 of surplus value. As Marx put it in Capital III, Chapter 15.
“Given the necessary means of production, i.e., a sufficient accumulation of capital, the creation of surplus-value is only limited by the labouring population if the rate of surplus-value, i.e., the intensity of exploitation, is given; and no other limit but the intensity of exploitation if the labouring population is given.”
That creates an inevitable contradiction. Capital seeks to maximise surplus value, by raising the rate of surplus value. The only way to do that is by increasing the length (time wages) or intensity (piece wages) of the working-day, so as to increase absolute surplus value. If the existing working-day is 10 hours, of which 5 represent necessary labour and 5 surplus labour, raising the working-day to 12 hours increases surplus value to 7 hours. Likewise, if with piece-rates an average 100 pieces per hour is required, that might rise to 120 pieces.
However, there are physical limits to such increases. Beyond a certain level of intensity, workers can only work for shorter periods, and vice versa. For any worker, in any day, they require a number of hours rest and recuperation, besides there only being 24 hours in a day. The other way of compensating for that is by increasing the length of the social working-day, i.e. employing more labour. Any given worker might be only able to work, optimally, for 12 hours, but that does not preclude using 2 workers, working shifts. Instead of 7 hours of surplus value, per day, there is, now 14 hours. The more the social-working-day is expanded, the more the mass of surplus value is increased.
However, as Marx describes in Capital III, Chapter 15, and Theories of Surplus Value, Chapter 21, there is still a physical limit to that. Firstly, shift systems allow a certain amount of fixed capital to be used more effectively, but, after a while, more buildings and machines are required. The use of more capital, including just more raw materials, with no more rapid growth of surplus value, means a fall in the rate of profit. Moreover, as employment rises, relative labour shortages mean rising nominal wages, but also real wages, and eventually, relative wages, i.e. a rise in wage share, and squeeze on profits/overproduction of capital.
The answer to that, Marx suggests, in the earlier quote, is to turn to the other determinant of surplus value, the level of technological development/productivity. In other words, if social productivity rises, even with a 10 hour working-day, surplus value rises to 7 hours, if the necessary labour falls to only 3 hours. Higher productivity cheapens wage goods, and so reduces necessary labour.
That, however, conflicts with the other element of maximising surplus value, which is the need to maximise the employment of labour. Higher productivity, by definition, means less labour required to produce any given amount of output. As the mass of surplus value is determined by the mass of labour employed x the rate of surplus value, raising the latter, by increasing productivity, reduces the former. Capital has to continually reconcile this contradiction as manifests over the long wave cycle, in alternating phases of extensive and intensive accumulation.
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