In Capital Volume 1 Marx provides an example of how the productive powers of society have come up against restricted relations of production, how they have further developed and in so doing have consequently revolutionised the economic foundation of society.
This involved the movement from what Marx called the formal subsumption of labour under capital to real subsumption. At first, the existing labour process, including the workers labour power, their technology, means of production, and markets, are taken under ownership by a capitalist; where previously individual workers’ families produced and sold (or not) on their own behalf. This latter activity is, of course, not capitalist because no worker is exploited (except perhaps that they exploit themselves) and it is impossible to define a workers’ wage separately from any consideration of profit that the family may be considered to have made.
This, Marx calls “formal” subsumption, under which the whole labour process continues much as before, with previously independent workers now working for a capitalist, perhaps using the same methods, with the capitalist now monopolising the means of production and ownership of the product. The typical example given is of hand-loom weavers, who continued working as before but did so on behalf of a capitalist who puts out the raw material to be worked upon and will take it back in finished form to sell, while the worker and their family carries out their labour in the home.
Considered at this stage, the workers’ means of subsistence may or may not be produced wholly or partly by the workers’ family itself, which if it is, may either give the worker some freedom to refuse demands from the capitalist if they are considered too onerous; or may entail very low wages which on their own would not be enough to maintain the subsistence needs of the worker and family without their own domestic production. In either case the capitalist must be able to make a profit and may be greatly empowered to do so if he can compel the worker to submit to wage-labour through total reliance on it for his or her livelihood and that of the family.
This is therefore capitalism, or rather capitalism in a very limited and undeveloped form, because in its early forms it can either involve the workers’ reliance on their own production of subsistence needs and/or is based upon existing production techniques that are not developed by the capitalist to extract more surplus labour.
We do not yet have the social forces of production in the form of capitalism. Such wage labour has existed for centuries without what we could recognise as something called capitalism as a system in existence. Indeed, pure wage labour has gone further than this without being generalised. It is not therefore the case that we have prior or newly created and fully capitalist relations giving rise to capitalism itself.
Capitalism as such cannot develop on the limited basis it finds in the already existing forces of production. The pre-requisites for capitalism as a system, as a form of truly social production as we now know it, is a capitalist labour process that is the real subsumption of labour under capital, where the instruments of production can only be operated cooperatively and not individually as before.
Only when the forces of production, including the type of division of labour and its organisation, have been radically developed beyond the restrictions of the purely formal subsumption of labour can the whole social relations of production within society become thoroughly imbued with the nature and requirements of capital. Only then does capitalism become generalised, obligatory and a totality.
Only when labour is combined together, and the potential technology appropriate to such combinations developed, can the productive power of capital be unleashed and we can move from more or less isolated, primitive and undeveloped forms of capitalist exploitation to a whole society of commodity production in which the vast mass of potential labour power is dependent on employment by capital. In the words of Marx only then do capitalist relations achieve their “adequate form” and they gain their “totality and extent”.
The superior productivity – productive power – of the developing capitalist forces of production can then destroy less efficient methods of production (if it is allowed to) or it uses the state to enforce ‘free trade’ on less efficient productive arrangements. We then have a society in which every need of the worker and capitalist is provided by wage labour working for capital, and gone are the days when such needs were met by the product of one’s own labour or the trading by oneself of one’s own products for those not self-made. While the latter limits the organisation and division of labour including the application of technology, the employment of wage labour cooperatively together in one place opens up an enormous vista of expanding productivity.
With the real subsumption of labour the expansion of capital involves enormously increased accumulation of labour and the instruments of labour; a previously inconceivable increased division of labour; the centralization and concentration of capital on an gigantic scale and the development of specifically capitalist forms of crisis, which no longer involve a shortage of production but are the result of too much production, overproduction of commodities that cannot be sold profitably.
Before long the exploitation of labour increases not because the working day is extended and its intensity increased, although tendencies to this never cease to be the case under capitalism, but because the division of labour and technology increases labour productivity, so cheapening the products of labour consumed by the worker and therefore reducing the time the worker must labour to reproduce her own wage while increasing the time in which she works to create profit for the capitalist.
By such a process new products and methods of production are created, adding to workers’ needs and the means by which these needs are satisfied, with the latter determining the former. The versatility required of the working class is much increased and the ‘civilising’ process of capitalism can be seen to operate, while the exploitation of labour increases at the same time. In fact, within the massive increase in the productivity of social labour they are aspects of the same process.
The productive forces are developed enormously under the spur of the prevalent relations, these relations having been given full reign by the power of the productive forces corresponding and adequate to their particular form.
But it is Marx’s contention that such correspondence and adequacy is historically limited, just as the previous relations of production were adequate to a certain level of productive forces, but which had to give way when these subsequently became fetters.
Previous isolated wage-labour relations were limited because the productive forces were not sufficient for any further development and/or the production based on wage labour was not for profit but for the increased consumption of the ruling classes.
A society based on generalised commodity production requires productive forces more powerful than were then employed. It is not therefore possible to consider internal contradictions within relations of production as adequate to an explanation of historical development and certainly not of historical progress. The contradiction in feudalism between feudal lord and peasant did not develop a new mode of production (peasant or otherwise); when this new mode did arise it involved development of productive forces that neither class could become the bearer of.
A theory of historical development that considered only relations of production, and subsumed what may be considered the forces of production within them, would efface the reality that production is a result of material processes and constructions that social relations assume but do not define. It leads to a view that the social relations of capitalism are embodied in the material elements of production so that what is materially required for production is already assumed to be capitalist in nature.
So, capital for example, becomes machines and equipment, and people have ‘human capital’, when capital is really a relation between capitalist and worker in which the latter works for the former and the former owns what has already been assumed to be ‘capital’ – the machines and equipment, product of labour and use of labour power. Such a view distorts the fact that worker ownership of this ‘capital’ does not necessarily mean they also become capitalists. A society in which the means of production are owned by those who work it is a socialist one, in which the working class ceases to be a class because they no longer work for capitalists. Incomplete development of such a society may be one considered to be in transition and considered just such a transitional society.
Neither should workers be confused that the skills and knowledge they acquire and with which they may acquire higher wages makes them in any sense a capitalist, earning any profit on their skill – this skill does not allow them to make any money out of other people’s work.
The distinction between forces and relations of production are therefore necessary to understanding capitalism and the possibility of an alternative to it.
Back to part 21
Forward to part 23
Sráid Marx 
You can find a useful essay on the Critique of the Gotha programme by Karl Korsch, if you search with google. It is very informative on the origins and reception of it in its German context. Only started to read essays by K.K a few months ago. Does not deserve his relative neglect. He was for many years a leading figure in revolutionary politics, he was denounced then expelled by the Russian leadership of Third International similar to Troksky, however he never made an alliance with Trotsky whom he held co- responsible for the degeneration of Revolutionary Movement. Ended up in America in poor health and living in poverty. A sad fate for one who did so much in his other life in Germany.
Thanks for the tip, I’ve found it and will read with interest.
I intend to write about the ‘Critique of Gotha Programme’ as part of this series of posts but it’s further down the line and since this series is as much a process of self-education as anything else I’m not in a position to start doing it now!
Boffy – thank you for your posts which have added a layer of depth to the analysis. You are correct that “The social relation is not between capitalist and worker, but between capital and labour.” I recall Simon Clarke writing (in’ Socialist Humanism and the Critique of Economism’) that class relations cannot be understood and analysed at the level of the individual or individual enterprise but that this relationship assumes “the more fundamental relation between capital and free labour”, although in his piece he is more concerned to argue that such a relation is more than a narrowly economic one.
My only slight quibble is with your sentence “This indeed is why socialism cannot simply arise on some voluntaristic basis of simply becoming the owners of the means of production”. Given what is involved in the working class assuming ownership of the means of production I don’t think that this could really be termed ‘voluntaristic.’ It might be better to simply say that “This indeed is why socialism cannot simply arise on the basis of simply becoming the owners of the means of production”.
However, assuming such ownership, and therefore absence of a capitalist class, we are well on the road to socialism, assuming the superiority of a fully cooperative society in developing the forces of production. Of course, Marx remarks that without this adequate development all the old muck involving struggle for necessities would be reproduced, but I assume that 21st century capitalism has so developed the forces of production that a cooperative economy that provides the basis for political rule by the laboring classes would be ‘socialist’ in the broad sense of that term, while not yet corresponding to the goal set out in the ‘Critique of Gotha Programme’.
In terms of where we are today, we already have a large cooperative sector and it cannot be described as socialist for a number of reasons but may, as you note, rather be described as workers becoming their own capitalist. To go beyond this requires a political struggle that envisages such cooperative production becoming the conscious vehicle for overcoming capitalism. Again, the subject of future posts I hope.
“You are correct that “The social relation is not between capitalist and worker, but between capital and labour.”
I think Marx’s distinction in the Grundrisse is instructive. “Labour as not capital, capital as not labour.”
Elsewhere, I have also suggested that the “synthesis” of this dichotomy, as suggested by Marx is precisely that set out in Capital III, Chapter 27, that both categories are dissolved as labour once more becomes owner of the means of production via the development of socialised capital, but the process of dissolution, is precisely that, a process not an event, and I have also cited Marx and Engels where they foresee this process being a long one, in the same way that capital did not supplant feudal relations overnight.
My use of the term “voluntaristic” was intended to convey the idea that contrary to what some would seem to believe, it is not simply a matter of political will of workers seizing the means of production that is a necessary foundation for socialist construction. The Russian, Chinese, Cuban revolutions showed that, even where the forces of production are not yet sufficiently developed – in all those cases the working-class formed a small minority of the population – it is possible for ideas that have been developed elsewhere, where the forces of production have been so developed, to be transplanted – an aspect of combined and uneven development – and for those ideas to take hold, and take on a life of their own, that itself becomes a powerful material social force. It is a similar point to that, which Marx makes in his Preface to Capital I, where he says that the economic ideas developed in Britain, and the political ideas developed in France, where economic and social development were in advance, became transplanted on to German soil, where the economic and social conditions were not so developed. The more developed society shows a picture of its future to the less developed society. The less society, on the basis, of those ideas, however, finds itself then a victim of its own lack of development.
“Where capitalist production is fully naturalised among the Germans (for instance, in the factories proper) the condition of things is much worse than in England, because the counterpoise of the Factory Acts is wanting. In all other spheres, we, like all the rest of Continental Western Europe, suffer not only from the development of capitalist production, but also from the incompleteness of that development. Alongside the modern evils, a whole series of inherited evils oppress us, arising from the passive survival of antiquated modes of production, with their inevitable train of social and political anachronisms. We suffer not only from the living, but from the dead.”
A point that Lenin also makes in relation to Russian development.
So, in a whole range of less developed societies we see ideas developed in developed societies taking root, without the necessary development of the productive forces to sustain them. That indeed, formed a large part of Lenin’s critique of the Economic Romanticism of the Narodniks, and yet it might be argued that Lenin himself fell victim to the same problem (possibly) in 1917. The concept that all that is required is the subjective will to take hold of the means of production, and proceed to the construction of Socialism is also what underlies the theory of Socialism in One Country, and that kind of principle also underpins a lot of the ideas of the “idiot anti-imperialists” who want to construct some kind of state capitalist relations in less developed economies, whilst excluding any possibility of accumulating capital with the assistance of foreign capital – solely on the basis that this foreign capital is “imperialist”.
And, we see the same thing in other guises. For example, at the time of the greek crisis, there were many who put forward the idea that the Greeks could find a solution to their problems by leaving the Eurozone and the EU, restoring the Drachma and so on. In other words, the idea that the crisis itself had nothing to do with economic fundamentals, with a lack of capital, or competitiveness and so on, and so could simply be result by some kind of voluntaristic political act of will! It would, of course, have led to an even worse disaster than the EU conservative politicians inflicted upon it.
My point is that even the creation of a society in which socialised capital dominates, and in which that socialised capital is under the democratic control of workers, requires not only that the forces of production are developed enough to lead to the creation of socialised capital, but that they are developed enough that having taken control of that capital, the workers are able to provide themselves with a standard of living at least equal to that of workers in the most developed economies, that they are able to act as a beacon to workers in other countries and so on, and that they can begin to remove increasing aspects of life from the domain of exchange value.
A society of owners of co-operative property, who have to work 10 hours a day to compete with their capitalist neighbours will not last for long. But, you are right, that we in fact already have a sizeable co-operative sector. My current view is that again you are right about the need for a political struggle, but my focus is on two things.
Firstly, the most important companies are joint stock companies where the capital is socialised, but under the control of shareholders. We should concentrate on a political and legal struggle against that privileged position of shareholders who exercise control over capital they do not own. As I have set out before, John Kay and Aubrey Silbertson have provided the legal case as to why shareholders do not own this socialised capital. The Bullock Report, The EU Draft Fifth Company Law Directive, and the existence of the Co-determination Laws in Germany show the basis for removing that right that shareholders currently exercise.
Secondly, there is hundreds of billions of pounds of workers funds in UK company pension funds, yet the workers themselves have no control over those funds. The control as recent cases have shown resides with the company, and often as with BHS, Carillion, Tata Steel and so on, when the company goes bust, the pension fund money is found to have disappeared as well. The funds are controlled by fund managers appointed by the company, and as Panorama showed a few years ago, up to 66% of the money paid in goes in various commission and other back handers, before it even gets to be invested. Control over the shares in the funds is usually exercised by banks,as Robin Murray showed some time ago. That is before we even consider all of the money in the state NI scheme, that again workers have no control over.
As a basic democratic demand, the labour movement should organise a political struggle to put all of these pension funds under direct control of the workers whose contributions are paid into them, and whose future pensions they are supposed to provide for.
That is a political struggle that could be waged here and now across Europe, and beyond, by an international working-class movement.
Reblogged this on seachranaidhe1.
Sraid Marx did say it was socialist only in the transitional sense. The concept of relative abundance is probably a non starter. There is either abundance or scarcity and no in between. If you recall the Von Mises like attack on socialism begins with the thought that hypostazing the absence of economic scarcity is ridiculous, it would mean that the economic allocation problem no longer existed, make economic choice, calculation and science unnecessary. Fortunately Marx only hints at this ridiculous thing I believe in the one paragraph of the Critique of the Gotha Programme.
‘In a more advanced phase of communist society, when the enslaving subjugation of individuals to the division of labour, and thereby the antithesis between intellectual and physical labour,have disappeared; when labour is no longer just a means of keeping alive but has itself become a vital need; when all round development of individuals has also increased their productive powers and all the springs of cooperative wealth flow more abundantly-only then society wholly cross the narrow horizon of bourgeois right and inscribe on it banner; From each according to his abilities, to each according to his needs’
So in the higher stage of communism the term needs has replaced the term work/labour. In short you can have anything you like without offering an equivalent labour time in return. This is the one of the residual Utopian elements in the philosophy of the later Marx, not as standout as in the German Ideology, the one about being a jack of all the trades and professions, a fisherman in the morning and a poet in the afternoon. Was looking at interview with Seamus Heaney on you tube the other day about having to give up the day job to write good poetry. Of course he said I could write bad poetry if I had stuck with the day job. Fortunately what Marx has to say in the lower stage of communism in the Gotha notes is a bit more sensible.
You should do a blog on the Critique of Gotha Programme, arguably the most difficult of his parchments to unfold.. Good luck with that one !
“So, capital for example, becomes machines and equipment, and people have ‘human capital’, when capital is really a relation between capitalist and worker in which the latter works for the former and the former owns what has already been assumed to be ‘capital’ – the machines and equipment, product of labour and use of labour power. Such a view distorts the fact that worker ownership of this ‘capital’ does not necessarily mean they also become capitalists. A society in which the means of production are owned by those who work it is a socialist one, in which the working class ceases to be a class because they no longer work for capitalists. Incomplete development of such a society may be one considered to be in transition and considered just such a transitional society.”
Here I have to disagree. The social relation is not between capitalist and worker, but between capital and labour. The human beings that occupy the roles of capitalist and worker are merely personifications of these two social forces, as Marx puts it in Capital I. What defines capital as part of this social relation is the social context. In other words, if I buy an electric drill is it simply means of production, or even means of consumption, if I use it for the purpose of DIY as a hobby, or is it capital. The same drill can be all of these different things dependent upon the social context. It is only capital if I buy it for the purpose of using it capitalistically, i.e. if I buy to use for the purpose of producing a commodity, whose value/price of production is greater than the value/price of production of the various commodities that went into its production. Moreover, it only acts as capital, if it is my intention to use the surplus value/profit resulting from this activity capitalistically, i.e. to accumulate it into additional capital, which I then use to produce on a larger scale. If I simply produce a surplus value/profit from its use, and use this profit to increase my consumption, then I have not in fact used it capitalistically.
But, by the same token, workers can own the means of production, and yet so long as this social relation of capital and labour continues to exist, the mode of production remains capitalist not socialist. It is simply that, as Marx says in Capital III, Chapter 27, the workers turn themselves into their own capitalist. This indeed is why socialism can simply arise on some voluntaristic basis of simply becoming the owners of the means of production, because socialism requires more than that. It means that the forces of production must themselves have been developed to such a degree that this social context in which the means of production must be used as capital, so as to further accumulate capital, can be progressively replaced with a social context in which relative abundance exists, that the productive forces have been developed to such a degree that a general level of adequate consumption has been achieved, so that it starts to become possible to decide to allocate portions of output to increasing consumption of wider ranges of products, or to reducing the working day/life etc.
Its why Marx does not call the worker owned co-operatives or the joint stock companies socialist, but socialised capital, as transitional forms of property. Its why lenin described the mode of production in Russia as being state capitalist, within the context of a Workers State with bureaucratic deformations.
Correction. Should say, “This indeed is why socialism cannot simply arise on some voluntaristic basis of simply becoming the owners of the means of production”
On the formal and real subsumption of labour, I think its important to make a further distinction that Marx makes, and expands upon in TOSV. In the first stages of the formal subsumption what you effectively have is a continuation of the “putting out system”, but within the confines of a handicraft “manufactory”. Each worker maintains the semblance of being an independent handicraft producer within this context, which is why Marx says that they do not yet form part of a collective worker.
Moreover, because each worker in this context is considered, and considers themselves, an independent producer, selling the product of their labour to the capitalist, as opposed to selling their labour-power, as a commodity, they bargain for the price of the product of this labour on an individual basis too, rather than collectively. A parallel today might be all of those BBC News presenters, who all work for BBC News, but who all have vastly different salaries, because they negotiate their individual payments via agents and so on, rather than as part of a collective through a union, as part of collective bargaining.
This is also, Marx explain why, you get in the writings of some of the earlier economists a discussion of why the product that the worker sells to the capitalist is not equal to its value, by an amount equal to the profit. It is because in effect, in these early manifestations it appears that the worker is indeed selling the product of their labour to the capitalist, not their labour-power. Often, in the handicraft manufactories, prior to machine industry, the workers themselves owned their own tools and other instruments of production. The capitalist simply provide them with the factory in which to operate, and provided them with materials to process, much as was the case under the Putting Out system. Having taken possession of the material, the worker then processed it, and “sold” it back to the factory owner. Another variation of this can be seen in piece work.
The other important point here is that, Marx explains that at this early stage the direct producers only accede to both the putting out system, and this formal subsumption to capital, because of some personal crisis that prevented them from being able to provide themselves with materials as means of production – they usually still retained their tools and other instruments of production prior to machine industry – but Marx emphasises, at this stage, they still have the potential to remove themselves from that condition and to ocne more take up a position as an independent producer selling commodities into the market on their own behalf.
What changes that is that within the factory, the division of labour intensifies so that workers go from being these independent handicraft producers simply brought together under one roof, to being detail workers, each concentrating on some specific aspect of the product, which in turn must then be assembled with other components. At first, even at this stage the workers remain essentially skilled handicraft producers, but say a wheelwright goes from being just a wheelwright who produces carriage wheels, and then as the process continues the job of producing wheels gets broken down into being the production of spokes, rims and so on. Ultimately, as machines are introduced, the worker no longer has the skills to be able to produce a complete commodity by their own labour, so the ability to become an independent producer thereby disappears. Their labour is no longer just formally subsumed, but is actually subsumed by capital, because now it can only function at the discretion of capital it can only function is generic factory labour, which requires that it must work in some kind of factory, and factories only belong to capital.