The first enlargement of reproduction gave the following picture:
I. _4,400c + 1,100v + 1,100s = 6,600_
II. _1,600c + 800v + 800s = 3,200_
-----
Total: 9,800
This already clearly expresses the interdependence of the two
departments--but it is a dependence of a peculiar kind. Accumulation
here originates in Department I, and Department II merely follows suit.
Thus it is Department I alone that determines the volume of
accumulation. Marx effects accumulation here by allowing Department I to
capitalise one-half of its surplus value; Department II, however, may
capitalise only as much as is necessary to assure the production and
accumulation of Department I. He makes the capitalists of Department II
consume 600_s_ as against the consumption of only 500_s_ by the
capitalists of Department I who have appropriated twice the amount of
value and far more surplus value. In the next year, he assumes the
capitalists of Department I again to capitalise half their surplus
value, this time making the capitalists of Department II capitalise more
than in the previous year--summarily fixing the amount to tally exactly
with the needs of Department I. 500_s_ now remain for the consumption of
the capitalists of Department II--less than the year before--surely a
rather queer result of accumulation on any showing. Marx now describes
the process as follows:
'Then let Department I continue accumulation at the same ratio, so that
550_s_ are spent as revenue, and 55_s_ accumulated. In that case, 1,100
I_v_ are first replaced by 1,100 I_c_, and 550 I_s_ must be realised in
an equal amount of commodities of II, making a total of 1,650 I(_v +
s_). But the constant capital of II, which is to be replaced, amounts
only to 1,600, and the remaining 50 must be made up out of 800 II_s_.
Leaving aside the money aspect of the matter, we have as a result of
this transaction:
'I. _4,400c + 550s_ (to be capitalised); furthermore, realised in
commodities of II for the fund for consumption of the capitalists and
labourers of I, 1,650 (_v + s_).
'II. _1,650c + 825v + 725s_.
'In Department I, 550_s_ must be capitalised. If the former proportion
is maintained, 440 of this amount form constant capital, and 110
variable capital. These 110 must be eventually taken out of 725 II_s_,
that is to say, articles of consumption to the value of 110 are consumed
by the labourers of I instead of the capitalists of II, so that the
latter are compelled to capitalise these 110_s_ which they cannot
consume. This leaves 615 II_s_ of the 725 II_s_. But if II thus converts
these 110 into additional constant capital, it requires an additional
variable capital of 55. This again must be taken out of its surplus
value. Subtracting this amount from 615 II_s_, we find that only 560
II_s_ remain for the consumption of the capitalists of II, and we obtain
the following values of capital after accomplishing all actual and
potential transfers:
I. _(4,400c+440c) + (1,100v+110v) = 4,840c + 1,210v = 6,050_
II. _(1,600c+50c+110c) + (800v+25v+55v) = 1,760c + 88v = 2,640_
-----
Total: 8,690'[103]
This quotation is given at length since it shows very clearly how Marx
here effects accumulation in Department I at the expense of Department
II. In the years that follow, the capitalists of the provisions
department get just as rough a deal. Following the same rules, Marx
allows them in the third year to accumulate 264_s_--a larger amount this
time than in the two preceding years. In the fourth year they are
allowed to capitalise 290_s_ and to consume 678_s_, and in the fifth
year they accumulate 320_s_ and consume 745_s_. Marx even says: 'If
things are to proceed normally, accumulation in II must take place more
rapidly than in I, because that portion of I(_v + s_) which must be
converted into commodities of II_c_, would otherwise grow more rapidly
than II_c_, for which it can alone be exchanged.'[104]
Yet the figures we have quoted fail to show a quicker accumulation in
Department II, and in fact show it to fluctuate. Here the principle
seems to be as follows: Marx enables accumulation to continue by
broadening the basis of production in Department I. Accumulation in
Department II appears only as a condition and consequence of
accumulation in Department I: absorbing, in the first place, the other's
surplus means of production and supplying it, secondly, with the
necessary surplus of consumer goods for its additional labour.
Department I retains the initiative all the time, Department II being
merely a passive follower. Thus the capitalists of Department II are
only allowed to accumulate just as much as, and are made to consume no
less than, is needed for the accumulation of Department I. While in
Department I half the surplus value is capitalised every time, and the
other half consumed, so that there is an orderly expansion both of
production and of personal consumption by the capitalists, the twofold
process in Department II takes the following erratic course:
1st year: 150 are capitalised, 600 consumed
2nd 240 660
3rd 254 626
4th 290 678
5th 320 745
Here there is no rule in evidence for accumulation and consumption to
follow; both are wholly subservient to the requirements of accumulation
in Department I.
Needless to say, the absolute figures of the diagram are arbitrary in
every equation, but that does not detract from their scientific value.
It is the _quantitative ratios_ which are relevant, since they are
supposed to express strictly determinate relationships. Those precise
logical rules that lay down the relations of accumulation in Department
I, seem to have been gained at the cost of any kind of principle in
construing these relations for Department II; and this circumstance
calls for a revision of the immanent connections revealed by the
analysis.
It might, however, be permissible to assume the defect to lie in a
rather unhappy choice of example. Marx himself, dissatisfied with the
diagram quoted above, proceeded forthwith to give a second example in
order to elucidate the movements of accumulation, where the figures of
the equation run in the following order:
I. _5,000c + 1,000v + 1,000s = 7,000_
II. _1,430c + 285v + 285s = 2,000_
-----
Total: 9,000
In contrast to the previous example, the capital of both departments is
here seen to have the same composition, i.e. constant and variable
capital are in a ratio of 5 to 1. This already presupposes a
considerable development of capitalist production, and accordingly of
social labour productivity--a considerable preliminary expansion of the
scale of production, and finally, a development of all the circumstances
which bring about a relatively redundant surplus population in the
working class. We are no longer introduced to enlarged reproduction, as
in the first example, at the stage of the original transition from
simple to enlarged reproduction--the only point of that is in any case
for the sake of abstract theory. This time, we are brought face to face
with the process of accumulation as it goes on at a definite and rather
advanced stage of development. It is perfectly legitimate to assume
these conditions, and they in no way distort the principles we must
employ in order to work out the individual loops of the reproductive
spiral. Here again Marx takes for a starting point the capitalisation of
half the surplus value in Department I.
'Now take it that the capitalist class of I consumes one-half of the
surplus-value, or 500, and accumulates the other half. In that case
(_1,000v + 500s_) I, or 1,500, must be converted into 1,500 II_c_. Since
II_c_ amounts to only 1,430, it is necessary to take 70 from the
surplus-value. Subtracting this sum from 285_s_ leaves 215 II_s_. Then
we have:
'I. _5,000c + 500s_ (to be capitalised) + 1,500(_v + s_) in the fund
set aside for consumption by capitalists and labourers.
'II. _1,430c + 70s_ (to be capitalised) + _285v + 215s_. As 70 II_s_ are
directly annexed by II_c_, a variable capital of 70 : 5, or 14, is
required to set this additional constant capital in motion. These 14
must come out of the 215_s_, so that only 201 remain, and we have:
'II _(1,430) + 70c + (285v + 14v) + 201s_.'[105]
After these preliminary arrangements, capitalisation can now proceed.
This is done as follows:
In Department I the 500_s_ which have been capitalised are divided into
five-sixths (417_c_) + one-sixth (83_v_). These 83_v_ withdraw a
corresponding amount from II_s_ which serves to buy units of constant
capital and thus accrues to II_c_. An increase of II_c_ by 83 involves
the necessity of an increase in II_v_ by 17 (one-fifth of 83). After the
completion of this turnover we therefore have:
I. _(5,000c + 417s) + (1,000v + 83s)v = 5,417c + 1,083v = 6,500_
II. _(1,500c + 83s) + (299v + 17s) = 1,538c + 316v = 1,899_
-----
Total: 8,399
The capital of Department I has grown from 6,000 to 6,500, i.e. by
one-twelfth; in Department II it has grown from 1,715 to 1,899, i.e. by
just over one-ninth.
At the end of the next year, the results of reproduction on this basis
are:
I. _5,417c + 1,083v + 1,083s = 7,583_
II. _1,583c + 316v + 316s = 2,215_
-----
Total: 9,798
If the same ratio is maintained in the continuance of accumulation, the
result at the end of the second year is as follows:
I. _5,869c + 1,173v + 1,173s = 8,215_
II. _1,715c + 342v + 342s = 2,399_
------
Total: 10,614
And at the end of the third year:
I. _6,358c + 1,271v + 1,271s = 8,900_
II. _1,858c + 371v + 371s = 2,600_
------
Total: 11,500
In the course of three years, the total social capital has increased
from I.6,000 + II.1,715 = 7,715 to I.7,629 + II.2,229 = 9,858, and the
total product from 9,000 to 11,500.
Accumulation in both departments here proceeds uniformly, in marked
difference from the first example. From the second year onwards, both
departments capitalise half their surplus value and consume the other
half. A bad choice of figures in the first example thus seems to be
responsible for its arbitrary appearance. But we must check up to make
sure that it is not only a mathematical manipulation with cleverly
chosen figures which this time ensures the smooth progress of
accumulation.
In the first as well as in the second example, we are continually struck
by a seemingly general rule of accumulation: to make any accumulation
possible, Department II must always enlarge its constant capital by
precisely the amount by which Department I increases (_a_) the
proportion of surplus value for consumption and (_b_) its variable
capital. If we take the example of the first year as an illustration,
the constant capital of Department II must be increased by 70. And why?
because this capital was only 1,430 before.
But if the capitalists of Department I wish to accumulate half their
surplus value (1,000) and to consume the other half, they need consumer
goods for themselves and for their workers to the tune of 1,500 units
which they can obtain only from Department II in exchange for their own
products--means of production. Since Department II has already satisfied
its own demand for producer goods to the extent of its own constant
capital (1,430), this exchange is only possible if Department II decides
to enlarge its own constant capital by 70. This means that it must
enlarge its own production--and it can do so only by capitalising a
corresponding part of its surplus value. If this surplus value amounts
to 285 in Department II, 70 of it must be added to the constant capital.
The first step towards expansion of production in Department II is thus
demonstrated to be at the same time the condition for, and the
consequence of, increased consumption by the capitalists of Department
I. But to proceed. Hitherto, the capitalists of Department I could only
spend one-half of their surplus value (500) on personal consumption. To
capitalise the other half, they must redistribute these 500_s_ in such a
way as to maintain at least the previous ratio of composition, i.e. they
must increase the constant capital by 417 and the variable capital by
83. The first operation presents no difficulties: the surplus value of
500 belonging to the capitalists of Department I is contained in a
natural form in their own product, the means of production, and is fit
straightway to enter into the process of production; Department I can
therefore enlarge its constant capital with the appropriate quantity of
its own product. But the remaining 83 can only be used as variable
capital if there is a corresponding quantity of consumer goods for the
newly employed workers. Here it becomes evident for the second time that
accumulation in Department I is dependent upon Department II: Department
I must receive for its workers 83 more consumer goods than before from
Department II. As this is again possible only by way of commodity
exchange, Department I can satisfy its demands only on condition that
Department II is prepared for its part to take up products of Department
I, producer goods, to the tune of 83. Since Department II has no use for
the means of production except to employ them in the process of
production, it becomes not only possible but even necessary that
Department II should increase its own constant capital by these very 83
which will now be used for capitalisation and are thus again withdrawn
from the consumable surplus value of this department. The increase in
the variable capital of Department I thus entails the second step in the
enlargement of production in Department II. All material prerequisites
of accumulation in Department I are now present and enlarged
reproduction can proceed. Department II, however, has so far made only
two increases in its constant capital. The result of this enlargement is
that if the newly acquired means of production are indeed to be used,
the quantity of labour power must be increased correspondingly.
Maintaining the previous ratio, the new constant capital of 153 requires
a new variable capital of 31. This implies the necessity to capitalise a
corresponding further amount of the surplus value. Thus the fund for the
capitalists' personal consumption in Department II comes to be what
remains of the surplus value (285_s_) after deduction of the amounts
used for twice enlarging the constant capital (70 + 83) and a
commensurate increase in the variable capital (31)--a fund of 101, after
deducting a total of 184. Similar operations in the second year of
accumulation result for Department II in its surplus value being divided
into 158 for capitalisation and 158 for the consumption of its
capitalists, and in the third year, the figures become 172 and 170
respectively.
We have studied this process so closely, tracing it step by step,
because it shows clearly that the accumulation of Department II is
completely determined and dominated by the accumulation of Department I.
Though this dependence is no longer expressed, as in Marx's first
example, by arbitrary changes in the distribution of the surplus value,
it does not do away with the fact itself, even if now the surplus value
is always neatly halved by each department, one-half for capitalisation
and the other for personal consumption. Though there is nothing to
choose between the capitalists of the two departments as far as the
figures are concerned, it is quite obvious that Department I has taken
the initiative and actively carries out the whole process of
accumulation, while Department II is merely a passive appendage. This
dependence is also expressed in the following precise rule: accumulation
must proceed simultaneously in both departments, and it can do so only
on condition that the provisions-department increases its constant
capital by the precise amount by which the capitalists of the
means-of-production-department increase both their variable capital and
their fund for personal consumption. This equation (increase II_c_ =
increase I_v_ + increase I_s.c_.)[106] is the mathematical cornerstone
of Marx's diagram of accumulation, no matter what figures we may choose
for its concrete application. But now we must see whether capitalist
accumulation does in actual fact conform to this hard and fast rule.
Let us first return to simple reproduction. Marx's diagram, it will be
remembered, was as follows:
I. _4,000c + 1,000v + 1,000s = 6,000_ means of production
II. _2,000c + 500v + 500s = 3,000_ means of consumption
-----
9,000 total production
Here, too, we established certain equations which form the foundation of
simple reproduction; they were:
(_a_) The product of Department I equals in value the sum of the two
constant capitals in Departments I and II.
(_b_) The constant capital of Department II equals the sum of variable
capital and surplus value in Department I--a necessary consequence of
(_a_).
(_c_) The product of Department II equals the sum of variable capital
and surplus value in both departments--a necessary consequence of (_a_)
and (_b_).
These equations correspond to the conditions of capitalist commodity
production (at the restricted level of simple reproduction, however).
Equation (_b_), for instance, is a result of the production of
commodities, entailed by the fact, in other words, that the
entrepreneurs of either department can only obtain the products of the
other by an exchange of equivalents. Variable capital and surplus value
in Department I together represent the demand of this department for
consumer goods. The product of Department II must provide for the
satisfaction of this demand, but consumer goods can only be obtained in
exchange for an equivalent part of the product of Department I, the
means of production. These equivalents, useless to Department II in
their natural form if not employed as constant capital in the process of
production, will thus determine how much constant capital there is to be
in Department II. If this proportion were not adhered to, if, e.g., the
constant capital of Department II (as a quantity of value) were larger
than I(_v + s_), then it could not be completely transformed into means
of production, since the demand of Department I for consumer goods would
be too small; if the constant capital (II) were smaller than I(_v +
s.c_), either the previous quantity of labour power could not be
employed in this department, or the capitalists could not consume the
whole of their surplus value. In all these cases, the premises of simple
reproduction would be violated.
These equations, however, are not just an exercise in mathematics, nor
do they merely result from the system of commodity production. To
convince us of this fact, there is a simple means at hand. Let us
imagine for a moment that, instead of a capitalist method of production,
we have a socialist, i.e. a planned society in which the social division
of labour has come to replace exchange. This society also will divide
its labour power into producers of means of production and producers of
means of consumption. Let us further imagine the technical development
of labour to be such that two-thirds of social labour are employed in
the manufacture of producer goods and one-third in the manufacture of
consumer goods. Suppose that under these conditions 1,500 units
(reckoned on a daily, monthly, or yearly basis) suffice to maintain the
whole working population of the society, one thousand of these being
employed, according to our premise, in Department soc. I (making means
of production), and five hundred in Department soc. II (making consumer
goods), and that the means of production dating from previous labour
periods and used up during one year's labour, represent 3,000 labour
units. This labour programme, however, would not be adequate for the
society, since considerably more labour will be needed to maintain all
those of its members who do not work in the material, the productive
sense of the term: the child, the old and sick, the civil servant, the
artist and the scientist. Moreover, every society needs certain reserves
against a rainy day, as a protection against natural calamities. Taking
it that precisely the same quantity of labour and, similarly, of means
of production as that required for the workers' own maintenance is
needed to maintain all the non-workers and to build up the reserves,
then, from the figures previously assumed, we should get the following
diagram for a regulated production:
I. _4,000c + 1,000v + 1,000s = 6,000_ means of production
II. _2,000c + 500v + 500s = 3,000_ means of consumption
Here _c_ stands for the material means of production that have been
used, expressed in terms of social labour time; _v_ stands for the
social labour time necessary to maintain the workers themselves and _s_
for that needed to maintain those who do not work and to build up the
reserves.
If we check up on the proportions of this diagram, we obtain the
following result: there is neither commodity production nor exchange,
but in truth a social division of labour. The products of Department I
are assigned to the workers of Department II in the requisite
quantities, and the products of Department II are apportioned to
everyone, worker or no, in both departments, and also to the
reserve-fund; all this being the outcome not of an exchange of
equivalents but of a social organisation that plans and directs the
process as a whole--because existing demands must be satisfied and
production knows no other end but to satisfy the demands of society.
Yet all that does not detract from the validity of the equations. The
product of Department I must equal I_c_ + II_c_: this means simply that
Department I must annually renew all the means of production which
society has used up during one year's labour. The product of Department
II must equal the sum of I(_v + s_) + II(_v + s_): this means that
society must each year produce as many consumer goods as are required by
all its members, whether they work or not, plus a quota for the reserve
fund. The proportions of the diagram are as natural and as inevitable
for a planned economy as they are for a capitalist economy based upon
anarchy and the exchange of commodities. This proves the diagram to have
objective social validity, even if, just because it concerns _simple_
reproduction, it has hardly more than theoretical interest for either a
capitalist or a planned economy, finding practical application only in
the rarest of cases.
The same sort of scrutiny must now be turned on the diagram of enlarged
reproduction. Taking Marx's second example as the basis for our test,
let us again imagine a socialist society. From the point of view of a
regulated society we shall, of course, have to start with Department II,
not with Department I. Assuming this society to grow rapidly, the result
will be an increasing demand for provisions by its members, whether they
work or not. This demand is growing so quickly that a constantly
increasing quantity of labour--disregarding for the moment the progress
of labour productivity--will be needed for the production of consumer
goods. The quantities required, expressed in terms of social labour
incorporated in them, increase from year to year in a progression of,
say, 2,000 : 2,215 : 2,399 : 2,600 and so on. Let us further assume that
technical conditions demand an increasing amount of means of production
for producing this growing quantity of provisions, which, again measured
in terms of social labour, mounts from year to year in the following
progression: 7,000 : 7,583 : 8,215 : 8,900 and so on. To achieve this
enlargement of production, we must further have a growth in the labour
performed _per annum_ according to the following progression: 2,570 :
2,798 : 3,030 : 3,284. [The figures correspond to the respective amounts
of I(_v + s_) + II(_v + s_).] Finally, the labour performed annually
must be so distributed that one-half is always used for maintaining the
workers themselves, a quarter for maintaining those who do not work, and
the last quarter for the purpose of enlarging production in the
following year. Thus we obtain the proportions of Marx's second diagram
of enlarged reproduction for a socialist society. In fact, three
conditions are indispensable if production is to be enlarged in any
society, even in a planned economy: (1) the society must have an
increasing quantity of labour power at its disposal; (2) in every
working period, the immediate needs of society must not claim the whole
of its working time, so that part of the time can be devoted to making
provision for the future and its growing demands; (3) means of
production must be turned out year after year in sufficiently growing
quantities--without which production cannot be enlarged on a rising
scale. In respect of all these general points, Marx's diagram of
enlarged reproduction has objective validity--_mutatis mutandis_--for a
planned society.
It remains to test whether it is also valid for a capitalist economy.
Here we must ask first of all: what is the starting point of
accumulation? That is the approach on which we have to investigate the
mutual dependence of the accumulative process in the two departments of
production. There can be no doubt that under capitalist conditions
Department II is dependent upon Department I in so far as its
accumulation is determined by the additional means of production
available. Conversely, the accumulation in Department I depends upon a
corresponding quantity of additional consumer goods being available for
its additional labour power. It does not follow, however, that so long
as both these conditions are observed, accumulation in both departments
is bound, as Marx's diagram makes it appear, to go on automatically year
after year. The conditions of accumulation we have enumerated are no
more than those without which there can be no accumulation. There may
even be a desire to accumulate in both departments, yet the desire to
accumulate plus the technical prerequisites of accumulation is not
enough in a capitalist economy of commodity production. A further
condition is required to ensure that accumulation can in fact proceed
and production expand: the effective demand for commodities must also
increase. Where is this continually increasing demand to come from,
which in Marx's diagram forms the basis of reproduction on an ever
rising scale?
It cannot possibly come from the capitalists of Departments I and II
themselves--so much is certain right away--it cannot arise out of their
personal consumption. On the contrary, it is the very essence of
accumulation that the capitalists refrain from consuming a part of their
surplus value which must be ever increasing--at least as far as absolute
figures are concerned--that they use it instead to make goods for the
use of other people. It is true that with accumulation the personal
consumption of the capitalist class will grow and that there may even be
an increase in the total value consumed; nevertheless it will still be
no more than a part of the surplus value that is used for the
capitalists' consumption. That indeed is the foundation of accumulation:
the capitalists' abstention from consuming the whole of their surplus
value. But what of the remaining surplus value, the part that is
accumulated? For whom can it be destined? According to Marx's diagram,
Department I has the initiative: the process starts with the production
of producer goods. And who requires these additional means of
production? The diagram answers that Department II needs them in order
to produce means of consumption in increased quantities. Well then, who
requires these additional consumer goods? Department I, of
course--replies the diagram--because it now employs a greater number of
workers. We are plainly running in circles. From the capitalist point of
view it is absurd to produce more consumer goods merely in order to
maintain more workers, and to turn out more means of production merely
to keep this surplus of workers occupied. Admittedly, as far as the
individual capitalist is concerned, the worker is just as good a
consumer, i.e. purchaser of his commodity, as another capitalist or
anyone else, provided that he can pay. Every individual capitalist
realises his surplus value in the price of his commodity, whether he
sells it to the worker or to some other buyer. But this does not hold
true from the point of view of the capitalist class as a whole. The
working class in general receives from the capitalist class no more than
an assignment to a determinate part of the social product, precisely to
the extent of the variable capital. The workers buying consumer goods
therefore merely refund to the capitalist class the amount of the wages
they have received, their assignment to the extent of the variable
capital. They cannot return a groat more than that; and if they are in a
position to save in order to make themselves independent as small
entrepreneurs, they may even return less, though this is the exception.
Part of the surplus value is consumed by the capitalist class itself in
form of consumer goods, the money exchanged for these being retained in
the capitalists' pockets. But who can buy the products incorporating the
other, the capitalised part of the surplus value? Partly the capitalists
themselves--the diagram answers--who need new means of production for
the purpose of expanding production, and partly the new workers who will
be needed to work these new means of production. But that implies a
previous capitalist incentive to enlarge production; if new workers are
set to work with new means of production, there must have been a new
demand for the products which are to be turned out.
Perhaps the answer is that the natural increase of the population
creates this growing demand. In fact, the growth of the population and
its needs provided the starting point for our examination of enlarged
reproduction in an hypothetical socialist society. There the
requirements of society could serve as an adequate basis, since the only
purpose of production was the satisfaction of wants. In a capitalist
society, however, the matter is rather different. What kind of people
are we thinking of when we speak of an increase in the population? There
are only two classes of the population according to Marx's diagram, the
capitalists and the workers. The natural increase of the former is
already catered for by that part of the surplus value which is consumed
inasmuch as it increases in absolute quantity. In any case, it cannot be
the capitalists who consume the remainder, since capitalist consumption
of the entire surplus value would mean a reversion to simple
reproduction. That leaves the workers, their class also growing by
natural increase. Yet a capitalist economy is not interested in this
increase for its own sake, as a starting point of growing needs.
The production of consumer goods for I_v_ and II_v_ is not an end in
itself, as it would be in a society where the economic system is shaped
for the workers and the satisfaction of their wants. In a capitalist
system, Department II does not produce means of consumption in large
quantities simply to keep the workers of Departments I and II. Quite the
contrary: a certain number of workers in Departments I and II can
support themselves in every case because their labour power is useful
under the obtaining conditions of supply and demand. This means that
the starting point of capitalist production is not a given number of
workers and their demands, but that these factors themselves are
constantly fluctuating, 'dependent variables' of the capitalist
expectations of profit. The question is therefore whether the natural
increase of the working class also entails a growing effective demand
over and above the variable capital. And that is quite impossible. The
only source of money for the working class in our diagram is the
variable capital which must therefore provide in advance for the natural
increase of the workers. One way or the other: either the older
generation must earn enough to keep their offspring--who cannot, then,
count as additional consumers; or, failing that, the next generation,
the young workers, must turn to work in order to obtain wages and means
of subsistence for themselves--in which case the new working generation
is already included in the number of workers employed. On this count,
the process of accumulation in Marx's diagram cannot be explained by the
natural increase of the population.
But wait! Even under the sway of capitalism, society does not consist
exclusively of capitalists and wage labourers. Apart from these two
classes, there are a host of other people: the landowners, the salaried
employees, the liberal professions such as doctors, lawyers, artists and
scientists. Moreover, there is the Church and its servants, the Clergy,
and finally the State with its officials and armed forces. All these
strata of the population can be counted, strictly speaking, neither
among the capitalist nor among the working class. Yet society has to
feed and support them. Perhaps it is they, these strata apart from the
capitalists and wage labourers, who call forth enlarged reproduction by
their demand. But this seeming solution cannot stand up to a closer
scrutiny. The landowners must as consumers of rent, i.e. of part of the
surplus value, quite obviously be numbered among the capitalist class;
since we are here concerned with the surplus value in its undivided,
primary form, their consumption is already allowed for in the
consumption of the capitalist class. The liberal professions in most
cases obtain their money, i.e. the assignment to part of the social
product, directly or indirectly from the capitalist class who pay them
with bits of their own surplus value. And the same applies to the
Clergy, with the difference only that its members also obtain their
purchasing power in part from the workers, i.e. from wages. The upkeep
of the State, lastly, with its officers and armed forces is borne by the
rates and taxes, which are in their turn levied upon either the surplus
value or the wages. Within the limits of Marx's diagram there are in
fact only the two sources of income in a society: the labourers' wages
and the surplus value. All the strata of the population we have
mentioned as apart from the capitalists and the workers, are thus to be
taken only for joint consumers of these two kinds of income. Marx
himself rejects any suggestion that these 'third persons' are more than
a subterfuge:
'All members of society not directly engaged in reproduction, with or
without labour, can obtain their share of the annual produce of
commodities--in other words, their articles of consumption ... only out
of the hands of those classes who are the first to handle the product,
that is to say, productive labourers, industrial capitalists, and real
estate owners. To that extent their revenues are substantially derived
from wages (of the productive labourers), profit and ground rent, and
appear as indirect derivations when compared to these primary sources of
revenue. But, on the other hand, the recipients of these revenues, thus
indirectly derived, draw them by grace of their social functions, for
instance that of a king, priest, professor, prostitute, soldier, etc.,
and they may regard these functions as the primary sources of their
revenue.'[107]
And about the consumers of interest and ground rent as buyers, Marx
says: 'Now, if that portion of the surplus-value of commodities, which
the industrial capitalist yields in the form of ground rent or interest
to other shareholders in the surplus-value, cannot be in the long run
converted into money by the sale of the commodities, then there is an
end to the payment of rent and interest, and the landowners or
recipients of interest can no longer serve in the role of miraculous
interlopers, who convert aliquot portions of the annual reproduction
into money by spending their revenue. The same is true of the
expenditure of all so-called unproductive labourers, State officials,
physicians, lawyers, etc., and others who serve economists as an excuse
for explaining inexplicable things, in the role of the 'general
public'.[108]
Seeing that we cannot discover within capitalist society any buyers
whatever for the commodities in which the accumulated part of the
surplus value is embodied, only one thing is left: foreign trade. But
there are a great many objections to a method that conceives of foreign
trade as a convenient dumping ground for commodities which cannot be
found any proper place in the reproductive process. Recourse to foreign
trade really begs the question: the difficulties implicit in the
analysis are simply shifted--quite unresolved--from one country to
another. Yet if the analysis of the reproductive process actually
intends not any single capitalist country but the capitalist world
market, there can be no foreign trade: all countries are 'home'. This
point is made by Marx already in the first volume of _Capital_, in
connection with accumulation:
'We here take no account of export trade, by means of which a nation can
change articles of luxury either into means of production or means of
subsistence, and _vice versa_. In order to examine the object of our
investigation in its integrity, free from all disturbing subsidiary
circumstances, we must treat the whole world as one nation and assume
that capitalist production is everywhere established and has possessed
itself of every branch of industry.'[109]
The same difficulty presents itself if we consider the matter from yet
another aspect. In Marx's diagram of accumulation we assumed that the
portion of the social surplus value intended for accumulation exists
from the first in a natural form which demands it to be used for
capitalisation.
'In one word, surplus-value is convertible into capital solely because
the surplus-product, whose value it is, already comprises the material
elements of new capital.'[110]
In the figures of our diagram:
I. _5,000c + 1,000v + 1,000s = 7,000_ means of production
II. _1,430c + 285v + 285s = 2,000_ means of consumption
Here, a surplus value of 570_s_ can be capitalised because from the very
outset it consists in means of production. To this quantity of producer
goods there correspond besides additional consumer goods to the amount
of 114_s_ so that 684_s_ can be capitalised in all. But the process here
assumed of simply transferring means of production to constant capital
on the one hand, consumer goods to variable capital on the other, in
commensurate quantities, is in contradiction with the very structure of
capitalist commodity production. Whatever natural form the surplus value
may have, there can be no immediate transfer to the place of production
for the purpose of accumulation. It must first be realised, it must be
turned into hard cash.[111]
Of the surplus value in Department I, 500 are fit to be capitalised, but
not until they have first been realised; the surplus value has to shed
its natural form and assume the form of pure value before it can be
added to productive capital. This is true for each individual capitalist
and also for the 'aggregate capitalist' of society, it being a prime
condition for capitalist production that the surplus value must be
realised in the form of pure value. Accordingly, regarding reproduction
from the point of view of society as a whole--
'We must not follow the manner copied by Proudhon from bourgeois
economy, which looks upon this matter as though a society with a
capitalist mode of production would lose its specific historical and
economic characteristics by being taken as a unit. Not at all. We have,
in that case, to deal with the aggregate capitalist.'[112]
The surplus value must therefore shed its form as surplus product before
it can re-assume it for the purpose of accumulation; by some means or
other it must first pass through the money stage. So the surplus product
of Departments I and II must be bought--by whom? On the above showing,
there will have to be an effective demand outside I and II, merely in
order to realise the surplus value of the two departments, just so that
the surplus product can be turned to cash. Even then, we should only
have got to the stage where the surplus value has become money. If this
realised surplus value is further to be employed in the process of
enlarging reproduction, in accumulation, an even larger demand must be
expected for the future, a demand which is again to come from
outside the two departments. Either the demand for the surplus
product will therefore have to increase annually in accordance
with the rate of increase of the accumulated surplus value, or--_vice
versa_--accumulation can only proceed precisely in so far as the demand
outside I and II is rising.