What determines these different forms is the mode of production, which itself is a consequence of the stage of development of the productive forces. In Theories of Surplus Value, Marx sets out that, for millennia, when individuals and households failed, the consequence was that they became debt slaves, serfs and servants, or else, became destitute paupers. They did not become wage-workers, employed by capital. The simple reason for that is that before capitalist production can arise, it must have a basis to exist, and that means that it must be able to produce more efficiently than the existing forms of production. To do so requires it to be able to produce on a large-scale, to be able to use machines, and to bring together sizeable numbers of labourers under one roof. But, to be able to produce on such a scale requires a large market for that production.
So long as the majority of the population are direct producers, i.e. largely self-sufficient peasants, that meet the majority of their own needs, and only sell a small amount of their surplus products in exchange for others, no such large market can exist. It is the expansion of the market in the Middle Ages, as the towns and cities expanded that creates the conditions in which capitalist production can exist.
On the one hand, capitalist production requires the existence of this large market, but it also requires the existence of labourers free to be employed by that capital. As Lenin sets out, for example, in On The So Called Market Question, these two factors go together. It was the release of serfs and feudal retainers in Western Europe that, in the Middle Ages, swelled the town populations and created urban markets. These migrants to the towns, then became independent commodity producers who must sell their output to obtain the other commodities they require. Competition between them results in winners and losers, the winners becoming bourgeois and the losers now becoming wage workers.
“For the conversion of money into capital the owner of money must meet in the market with the free labourer, free in the double sense, that as a free man he disposes of his labour-power as his own commodity, and that on the other hand he has no other commodity for sale, has no ties and is free of everything necessary for the realisation of his labour-power.” (p 263)
This double context of “free labourer”, i.e. free to sell their labour-power as a commodity on the market, and free in that they have no other means of subsistence, is considered in greater detail by Marx in The Grundrisse. It distinguishes the wage labourer from the slave or serf, for example, both of which undertake surplus labour, but which takes the form of a surplus product not surplus value. The reason is that the slave and the serf have the same position in production as animals or machines. They create no new value, and surplus value is only possible where labour creates new value that is in excess of the value of labour-power.
“... in the relations of slavery and serfdom….The slave stands in no relation whatsoever to the objective conditions of his labour; rather, labour itself, both in the form of the slave and in that of the serf, is classified as an inorganic condition of production along with other natural beings, such as cattle, as an accessory of the earth.”
(The Grundrisse, p 489)
The peasant producer does create new value, and it exceeds the value of labour-power, so creating a surplus product and surplus value, but a large part of this surplus product/value is taken as feudal rent by the landlord. The independent commodity producer creates new value and surplus value, and for some of them this leads to greater affluence, a greater accumulation of means of production. A proportion of this surplus value goes to pay rents, interest and taxes, and a portion goes to the commercial profit of merchants and money-dealing capitalists, who specialise in those functions, and so reduce the overhead costs of the producer.
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