Only when Duhring has to face the reality of the existence of very large capitalist farms is he forced to recognise the fallacy of that position. He goes on,
“Wherever we are dealing with fairly large farms it can easily be seen that it will not do to treat what are specifically the farmer’s earnings as wages. For these earnings are themselves based on the antithesis existing in relation to the rural labour-power, through whose exploitation that form of income is alone made possible. It is clearly a part of the rent which remains in the hands of the tenant and by which the full rent, which the owner managing himself would obtain, is reduced.” (p 286)
So, even here, whilst he recognises that describing the profit obtained as “wages” is untenable, he still views the relation as one in which the landlord appropriates the full rent (surplus value), as though they were themselves working the land and exploiting the labourers, but in which they must allow the capitalist to retain a portion of that rent. As seen before, he has simply changed the nomenclature, but kept the basic concepts the same. If the relation is one in which the rent is appropriated by the landlord, but who allows the capitalist farmer to retain a part of it, how is this different to simply calling what is, in reality, profit wages? Why does the landlord allow the capitalist farmer to retain this portion of rent, whether termed profit or wages?
Engels says,
“The theory of ground-rent is a part of political economy which is specifically English, and necessarily so, because it was only in England that there existed a mode of production under which rent had in fact been separated from profit and interest.” (p 286)
The historical outline is given by Marx in Capital and Theories of Surplus Value. In the 15th century, serfs released from the land moved to the towns, where they become small, independent commodity producers and traders. As Lenin, also, describes, in relation to Russia, following the 1861 Emancipation of the Serfs, this growth of commodity production and exchange, itself, expands the market.
The more producers specialise, and only produce one type of commodity to sell, the more, also, do they increase their own demand for all of those other products they previously produced themselves. All of these products they now buy as commodities, and others specialise in the production of these commodities. This specialisation and social division of labour is synonymous with the expansion of the market, and the realm of exchange-value. This urban industrial production, as a result of this specialisation, quickly begins to undermine the basis of rural domestic industry, and so of direct production, because the peasants always relied on their own domestic industry to supplement their agricultural production.
The competition between the urban commodity producers meant that the winners, the more efficient producers, expanded, which first assumes the form of greater affluence (quantitative change). They acquire better means of production and so on, and have larger families, providing more domestic labour, to produce on a larger scale. The losers are ruined. Their own means of production are bought up (centralised) by the winners. The losers are, then, employed by the winners, and only allowed to use their own, previous means of production, if they agree to provide an amount of free labour to their new employer. The winners, thereby, become capitalists, and the means of production become capital (qualitative change). The losers become proletarians, who only have their labour-power to sell as a commodity. They must, now, buy everything required for their own reproduction as commodities. The market expands again.
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