[4.] Bray as an Opponent of the Economists

[c)] So-called Accumulation as a Mere Phenomenon of Circulation. (Stock, etc.—Circulation Reservoirs)

Hodgskin examines only one of the constituent parts of circulating capital. One part of circulating capital is however continuously converted into fixed capital and auxiliary materials and only the other part is converted into articles of consumption. Moreover, even that part of circulating capital which is ultimately transformed into commodities intended for individual consumption always exists, alongside the final form in which it emerges from the finishing phase as end product, simultaneously in the earlier phases of production in its rudimentary forms—as raw material or semi-manufactured goods, removed in various degrees from the final form of the product—in which it cannot as yet enter into consumption.

The problem Hodgskin is concerned with is: what is the relation of the present labour performed by the worker for the capitalist to the labour embodied in his articles of consumption, the labour contained in those articles on which his wages are spent, which, in actual fact, are the use-values of which variable capital consists? It is admitted that the worker cannot labour without finding these articles ready for consumption. And that is why the economists say that circulating capital—the previous labour, commodities already created which the capitalist has stored up—is the condition for labour and, amongst other things, also the condition for the division of labour.

When the conditions of production, and especially circulating capital in Hodgskin’s sense of the term, are being discussed, it is usual to declare that the capitalist must have accumulated the food which the worker has to consume before his new commodity is finished, that is, while he works, while the commodity he produces is only in statu nascendi.[s] This is shot through with the notion that the capitalist either gathers things like a hoarder or that he stores up a supply of food like the bees their honey.

This however is merely a modus loquendi.[t]

First of all, we are not speaking here of the shopkeepers who sell means of subsistence. These must naturally have a full stock in trade. Their stores, shops, etc. are simply reservoirs in which the various commodities are stored once they are ready for circulation. This kind of storing is merely an interim period in which the commodity remains until it leaves the sphere of circulation and enters that of consumption. It is its mode of existence as a commodity on the market. Strictly speaking, as a commodity it exists only in this form. It does not affect the matter whether, instead of being in the possession of the first seller (the producer), the commodity is in the possession of the third or fourth and finally passes into the possession of the seller who sells it to the real consumer. It merely means that, in the intermediate stage, exchange of capital (really of capital plus profit, for the producer sells not only the capital in the commodity but also the profit made on the capital) for capital is taking place, and in the last stage exchange of capital for revenue (provided the commodity is intended not for industrial but for individual consumption, as is assumed here).

The commodity which is a finished use-value and marketable, enters the market as a commodity, in the phase of circulation; all commodities enter this phase when they undergo their first metamorphosis, the transformation into money. If this is called “storing up” then it means nothing more than “circulation” or the existence of commodities as commodities. This kind of “storing” is exactly the opposite of treasure-hoarding, the aim of which is to retain commodities permanently in the form in which they are capable of entering into circulation, and it achieves this only by withdrawing commodities in the form of money from circulation. If production, and therefore also consumption, is varied and on a mass scale, then a greater quantity of the most diverse commodities will be found continually at this stopping place, at this intermediate station, in a word, in circulation or on the market. Regarded from the standpoint of quantity, storing on a large scale in this context means nothing more than production and consumption on a large scale.

The stop made by the commodities, their sojourn at this stage of the process, their presence on the market instead of in the mill or in a private house (as articles of consumption) or in the shop or the store of the shopkeeper, is only ||871| a tiny fraction of time in their life-process. The immobile, independent existence of this world of commodities, of things, is only illusory. The station is always full, but always full of different travellers. The same commodities (commodities of the same kind) are constantly produced anew in the sphere of production, available on the market and absorbed in consumption. Not the identical commodities, but commodities of the same type, can always be found in these three stages simultaneously. If the intermediate stage is prolonged so that the commodities which emerge anew from the sphere of production find the market still occupied by the old ones, then it becomes overcrowded, a stoppage occurs, the market is glutted, the commodities decline in value, there is over-production. Where, therefore, the intermediate stage of circulation acquires independent existence so that the flow of the stream is not merely slowed down, where the existence of the commodities in the circulation phase appears as storing up, then this is not brought about by a free act on the part of the producer, it is not an aim or an immanent aspect of production, any more than the flow of blood to the head leading to apoplexy is an immanent aspect of the circulation of the blood. Capital as commodity capital (and this is the form in which it appears in the circulation phase, on the market) must not become stationary, it must only constitute a pause in the movement. Otherwise the reproduction process is interrupted and the whole mechanism is thrown into confusion. This materialised wealth which is concentrated at a few points is—and can only be—very small in comparison to the continuous stream of production and consumption. Wealth, therefore, according to Smith, is “the annual” reproduction. It is not, that is to say, something out of the dim past. It is always something which emerges from yesterday. lf, on the other hand, reproduction were to stagnate due to some disturbances or others, then the stores etc. would soon empty, there would be shortages and it would soon be evident that the permanency which the existing wealth appears to possess, is only the permanency of its being replaced, of its reproduction, that it is a continuous materialisation of social labour.

The movement C—M—C also takes place in the transactions of the shopkeeper. Insofar as he makes a “profit”, it is a matter which does not concern us here. He sells goods and buys the same goods (the same type of goods) over again. He sells them to the consumer and buys them again from the producer. Here the same (type of) commodity is converted perpetually into money and money back again continuously into the same commodity. This movement, however, simply represents continuous reproduction, continuous production and consumption, for reproduction includes consumption. (The commodity must be sold, must reach the sphere of consumption in order that it can be reproduced.) It must be accepted as a use-value. (For C—M for the seller is M—C for the buyer, that is, the conversion of money into a commodity as use-value.) The reproduction process, since it is a unity of circulation and production, includes consumption, which is itself an aspect of circulation. Consumption is itself both an aspect and a condition of the reproduction process. If one considers the process in its entirety, the shopkeeper, in fact, pays the producer of the commodities with the same sum of money as the consumer pays him when he buys from him. He represents the consumer in his dealings with the producer and the producer in his dealings with the consumer. He is both seller and buyer of the same commodity. The money with which he pays is, in fact, considered from a purely formal standpoint, the final metamorphosis of the consumer’s commodity. The latter transforms his money into the commodity as a use-value. The passing of the money into the shopkeeper’s hands thus signifies the consumption of the commodity or, considered formally, the transition of the commodity from circulation into consumption. Insofar as he buys again from the producer with the money, this constitutes the first metamorphosis of the producer’s commodity and signifies the transition of the commodity into the intermediate stage, where it remains as a commodity in the sphere of circulation. C—M—C, insofar as it concerns the transformation of the commodity into the consumer’s money and the transformation back again of the money, whose owner is now the shopkeeper, into the same commodity (a commodity of the same kind), expresses merely the constant passing over of commodities into consumption, for the vacuum left by the commodity reaching the sphere of consumption must be filled by the commodity emerging from the production process and now entering this stage.

||872| The period during which the commodity stays in circulation and is replaced by new commodities naturally depends also on the length of time in which the commodities remain in the production sphere, that is, on the duration of their reproduction time, and varies in accordance with their different length. For example, the reproduction of corn requires a year. The corn harvested in the autumn, for example, of 1862 (insofar as it is not used again for seed) must suffice for the whole coming year—until autumn 1863. It is thrown all at once into circulation (it is already in circulation when it is placed in the farmers’ granaries) and absorbed in the various reservoirs of circulation—storehouses, corn merchants, millers, etc. These reservoirs serve as channels both for the commodities issuing from production and those going to the consumer. As long as the commodities remain in one of them, they are commodities and are therefore on the market, in circulation. They are withdrawn only piecemeal, in small quantities, by the annual consumption. The replacement, the stream of new commodities which are to displace them, arrives only in the following year. Thus these reservoirs are only depleted gradually, in the measure that their replacements move forward. If there is a surplus and if the new harvest is above the average, then a stoppage takes place. The space which these particular commodities were to have occupied in the market is overstocked. In order to permit the whole quantity to find a place on the market, the price of the commodities is reduced, and this causes them to move again. If the total quantity of use-values is too large, they accommodate themselves to the space they have to occupy by a reduction of their prices. If the quantity is too small, it is expanded by an increase of their prices.

On the other hand, commodities which quickly deteriorate as use-values remain only for a very short time in the reservoirs of circulation. The period of time during which they have to be converted into money and reproduced, is prescribed by the nature of their use-value which, if it is not consumed daily or almost daily, is spoilt and consequently ceases to be a commodity. For exchange-value along with its basis, use-value, disappears provided the disappearance of use-value is not itself an act of production.

In general, it is clear that although in absolute terms the quantity of the commodities which have been stored up in the reservoirs of circulation increases as a result of the development of industry, because production and consumption increase, this same quantity represents a decrease in comparison with the total annual production and consumption. The transition of commodities from circulation to consumption takes place more rapidly. And for the following reasons. The speed of reproduction increases:

1) When the commodity passes rapidly through its various production phases, that is, when each production phase of the production process is reduced in length; this is due to the fact that the labour-time necessary to produce the commodity in each one of its forms is reduced, this is a result, therefore, of the development of the division of labour, use of machinery, application of chemical processes, etc. <The development of chemistry makes it possible to speed up the transition of commodities from one state of aggregation to another, their combination with other material which, for instance, occurs in dyeing, their separation from [other] substances as in bleaching; in short, both [modifications in] the form of the same substance (its state of aggregation) as well as changes to be brought about in the substance, are artificially accelerated quite apart from the fact, that for vegetative and organic reproduction, plants, animals, etc., are supplied with cheaper substances, that is, substances which cost less labour-time.>

2) Partly as a result of the combination of various branches of industry, that is, the establishment of centres of production for particular industrial branches, [partly] through the development of means of communication, the commodity proceeds rapidly from one phase to another; in other words, the interim period, the interval during which the commodity remains in the intermediate station between one production phase and another is reduced, that is, the transition from one phase of production to another is shortened.

3) This whole development—the shortening both of the various phases of the production process and of the transition from one phase to another—presupposes production on a large scale, mass production and, at the same time, production based on a large amount of constant capital, especially fixed capital; [it requires] therefore a continuous flow of production. But not in the sense in which we have earlier considered the flow, that is, not as the closing of and overlapping of the separate production phases, but in the sense that there are no deliberate breaks in production. These occur as long as work is done to order, as in ||873| the handicrafts, and continue even in manufacture properly so-called (insofar as this has not been reshaped by large-scale industry). In modern industry, however, work is carried out on the scale allowed by the capital. This process does not wait on demand, but is a function of capital. Capital works on the same scale continuously (if one disregards accumulation or expansion) and constantly develops and extends the productive forces. Production is therefore not only rapid, so that the commodity quickly acquires the form in which it is suitable for circulation, but it is continuous. Production here appears only as constant reproduction and at the same time it takes place on a mass scale.

Thus if the commodities remain in the circulation reservoirs for a long time—if they accumulate there—then they will soon glut them as a result of the speed with which the waves of production follow one another and the huge amount of goods which they deposit continuously in the reservoirs. It is in this sense that Corbet, for example, says the market is always overstocked. But the same circumstances which produce this speed and mass scale of reproduction likewise reduce the necessity for the accumulation of commodities in the reservoirs. In part—insofar as it is concerned with industrial consumption—this is already implied by the close succession of the production phases which the commodity itself or its ingredients have to undergo. If coal is produced daily on a mass scale and brought to the manufacturer’s door by railways, steamships, etc., he does not need to have a stock of coal, or at most only a very small one; or, what amounts to the same thing, if a merchant acts as an intermediary, he only needs to keep a small amount of stock over and above the amount he sells daily and which is daily delivered to him. The same applies to yarn, iron, etc. But apart from industrial consumption, in which the stock of commodities (that is, the stock of the ingredients of commodities) must decline in this way, the shopkeeper likewise enjoys the benefits of the speed of communications first of all, and secondly, the certainty of a continuous and rapid renewal and delivery. Although his stock of commodities may grow in size, each element of it will remain in his reservoir, in a state of transition, for a shorter period of time. In relation to the total amount of commodities which he sells, that is, in relation to the scale of both production and consumption, the stock of commodities which he accumulates and keeps in store, will be small. It is different in the less developed stages of production where reproduction proceeds slowly—where therefore more commodities must remain in the circulation reservoirs—the means of transport are slow, the communications difficult and, as a consequence, the renewal of stock can be interrupted and a great deal of time elapses as a result between the emptying and the refilling of the reservoir—that is, the renewal of the stock in hand. The position is then similar to that of products whose reproduction takes place yearly or half-yearly, in short in more or less prolonged periods of time, owing to the nature of their use-values.

Special filling of the reservoirs—insofar as this is not due to the overstocking of the market, which can happen much more easily in these circumstances than under archaically slow conditions—occurs only for speculative reasons and merely in exceptional cases because of a real or suspected fall or rise of prices. Regarding this relative decline in stock, that is, the commodities which are in circulation, compared with the amount of production and consumption, see Lalor, The Economist, Corbet (give the corresponding quotations ||874| after Hodgskin). Sismondi wrongly saw something lamentable in all this (his writings to be looked up as well).

(On the other hand, there is indeed a continuous extension of the market and in the degree that the interval of time decreases in which the commodity remains on the market, its flow in space increases, that is, the market expands spatially, and the periphery in relation to the centre, the production sphere of the commodity, is circumscribed by a constantly extending radius.)

The fact that consumption lives from hand to mouth, changes its linen and its coat as rapidly as it does its opinions and does not wear the same coat ten years running, etc. is connected with the speed of reproduction, or is another expression of it. To an increasing extent consumption—even of articles where this is not demanded by the nature of their use-value—takes place almost simultaneously with production and becomes therefore more and more dependent on the present, coexisting labour (since it is, in fact, exchange of coexisting labour). This takes place in the same degree in which past labour becomes an ever more important factor of production, even though this past itself is after all a very recent and only relative one.

(The following example demonstrates how closely the keeping of a stock is linked with deficiencies of production. As long as it is difficult to keep cattle throughout the winter, there is no fresh meat in winter. As soon as stock-farming is able to overcome this difficulty, the stock previously made up of substitutes for fresh meat—pickled or smoked varieties—ceases of itself.)

The product only becomes a commodity where it enters into circulation. The production of goods as commodities, hence circulation, expands enormously as a result of capitalist production for the following reasons:

1. Production takes place on a large scale, the quantity, the huge amounts produced, therefore, do not stand in any kind of quantitative relationship to the producer’s needs [of his own product]; in fact it is pure chance whether he consumes any, even a small part of his own product. He only consumes his own product on a mass scale where he produces some of the ingredients of his own capital. On the other hand, in the earlier stages [of economic development] only those products which exceed the amount required by the producer himself become commodities or, at any rate, this is mainly the case.

2. The narrow range of goods produced [stands] in inverse ratio to the increased variety of needs. This is due to previously combined branches of production becoming increasingly separated and independent—in short, to increasing division of labour within society—a contributing factor is the establishment of new branches of production and the increasing variety of commodities produced. ([To be inserted] at the end, after Hodgskin, also Wakefield about this.) This increased variety and differentiation of commodities arises in two ways. The different phases of one and the same product, as well as the auxiliary operations (that is, the labour connected with various constituent parts, etc.) are separated and become different branches of production, independent of one another; or various phases of one product become different commodities. But secondly, owing to labour and capital (or labour and surplus product) becoming free; on the other hand, to the discovery of new practical applications of the same use-value, either because new needs arise as a result of the modification of No. 1 (for example, the need for more rapid and universal means of transport and communication arising with the application of steam in industry) and therefore new means of satisfying them, or new possibilities of utilising the same use-value are discovered, or new substances or new methods (plastic-galvanisation, for instance) for treating well-known substance in different ways.

All this amounts to the following: successive phases or states of one product are converted into separate commodities. New products or new values in use are created and become commodities.

3. Transformation of the majority of the population who formerly consumed a mass of products in naturalibus[u] into wage-workers.

4. Transformation of the tenant farmer into an industrial capitalist <and with it the conversion of rent into money rent and generally of all payments in kind (taxes, etc., rent) into money payments>. In general—industrial exploitation of the land with the result that it is no longer confined to its own muck-heap as previously, but that both its chemical and mechanical conditions of production—even seeds, fertilisers, cattle, etc. are subjected to the process of exchange.

5. Mobilisation of a mass of previously “inalienable” possessions by conversion into commodities and the creation of forms of property which only exist in negotiable papers. On the one hand, alienation of landed property (the lack of property of the masses causes them, for example, to regard the dwelling in which they live as a commodity). [On the other hand,] railway shares, in short, all kinds of shares.

[d) Hodgskin’s Polemic Against the conception that the Capitalists “store Up” Means of Subsistence for the Workers. His Failure to Understand the Real causes of the Fetishism of Capital]

||875| Back again to Hodgskin now.

It is obvious that by “storing up” [means of subsistence] for the workers by the capitalists one cannot understand that commodities which are passing from production into consumption are in the circulation reservoirs, in the circulation system, on the market. This would mean that the products circulate for the benefit of the worker and become commodities for his sake; and that in general, the production of products as commodities is undertaken for his sake.

The worker shares with every other [commodity owner the need] to transform the commodity he sells—which in actual fact, though not in form, is his labour—at first into money in order to convert the money back again into commodities which he can consume. It is perfectly obvious that [no] division of labour (insofar as it is based on commodity production), [no] wage-labour and, in general, no capitalist production can take place without commodities—whether they be means of consumption or means of production—being available on the market; that this kind of production is impossible without commodity circulation, without the commodities spending a period of time in the circulation reservoir. For the product is a commodity in the strict sense of the word only within the framework of circulation. It is as true for the worker as for anybody else that he must find his means of subsistence in the form of commodities.

The worker, moreover, does not confront the shopkeeper as a worker confronts a capitalist, but as money confronts the commodity, as a buyer faces the seller. There is no relationship of wage-labour to capital here, except of course, where the shopkeeper is dealing with his own workers. But even they, insofar as they buy things from him, do not confront him as workers. They confront him as workers only insofar as he buys from them. Let us therefore leave this circulation agent.

But as far as the industrial capitalist is concerned, his stock, his accumulation, consists of:

[First] his fixed capital, i.e., buildings, machinery, etc., which the worker does not consume or, insofar as he does consume them, does so through labour, and thus consumes them industrially for the capitalist, and although they are means of labour they are not means of subsistence for him.

Secondly, his raw materials and auxiliary materials, the stock of which, insofar as it does not enter directly into production, declines, as we have seen. This likewise does not consist of means of subsistence for the workers. This accumulation by the capitalist for the workers means nothing more than that he does the worker the favour of depriving the latter of his conditions of labour and converting the means of his labour (which are themselves merely the transformed product of his labour) into means for the exploitation of labour. In any case, the worker, while he uses the machines and the raw materials, does not live on them.

Thirdly, the commodities, which he keeps in the storehouse or warehouse before they enter into circulation. These are products of labour, not means of subsistence stored in order to maintain labour during the course of production.

Thus the “accumulation” of means of subsistence by the capitalist for the worker means merely that he must possess enough money in order to pay wages with which the worker withdraws the articles of consumption he needs from the circulation reservoir (and, if we consider the [working] class as a whole, with which he buys back part of his own product). This money, however, is simply the transformed form of the commodity which the worker has sold and handed over. In this sense, the means of subsistence are “stored up” for him in the same way as they are stored up for his capitalist, who likewise buys consumption goods etc. with money (the transformed form of the same commodity). This money may be a mere token of value, it therefore does not have to be a representation “of previous labour” but, in the hands of whoever possesses it, simply expresses the realised price not of past labour (or previously [sold] commodities) but of the contemporaneous labour or commodities which he sells. [Money has] merely a formal existence. Or—since in previous modes of production the worker also had to eat and consume during the course of production irrespective of the period of time required for the production of his product—“storing up” may mean that the worker must first of all transform the product of his labour into the product of the capitalist, into capital, in order to receive back a portion of it in the form of money, in lieu of payment.

||876| What interests Hodgskin about this whole process (with regard to the process as such it is indeed a matter of indifference whether the worker receives the product of contemporaneous or previous labour, just as it does not matter whether he receives the product of his own previous labour or the product of labour performed simultaneously in a different branch) is this:

A great part, [or] the greatest part of the products consumed daily by the worker—which he must consume whether his own product is finished or not—represent by no means stored up labour of bygone time. On the contrary he uses to a large extent products of labour performed the same day or during the same week in which the worker produces his own commodity. For example, bread, meat, beer, milk, newspapers, etc. Hodgskin could also have added that they are partly the products of future labour, for the worker who buys an overcoat with what he has saved out of six months’ wages buys one which has only been made at the end of the six months, etc. (We have seen that the whole of production presupposes simultaneous reproduction of the required constituent parts and products in their different forms as raw materials, semi-manufactured goods, etc. But all fixed capital presupposes future labour for its reproduction and for the reproduction of its equivalent, without which it cannot be reproduced.) Hodgskin says that during the course of the year the worker must rely to some degree on previous labour (because of the nature of the production of corn, vegetable raw materials, etc.). <This does not apply to a house, for example. As regards use-values which, by their nature, only wear out slowly, are not consumed at once, but gradually used up, it is not due to any action specially devised for the benefit of the workers that these products of previous labour are available on “the market”. The worker also used to have a “dwelling” before the capitalist “piled up” deadly stink-holes for him. (See Laing on this.)> (Apart from the enormous mass of day-to-day needs which are of decisive importance especially to the worker. Who at best, can only satisfy his everyday needs, we have seen that, in general, consumption becomes more and more contemporaneous with production, and therefore, if one considers society as a whole, consumption depends more and more on simultaneous production, or rather on the products of simultaneous production.) But when operations extend over several years, the worker must “depend” on his own production, on the simultaneous and future producers of other commodities.

The worker always has to find his means of subsistence in the form of commodities on the market (the “services” he buys are ipso facto only brought into being at the moment they are bought); as far as he is concerned they must therefore be the products of antecedent labour, that is of labour which is antecedent to their existence as products but which is by no means antecedent to his own labour with whose price he buys these products. They can be—and mostly are—contemporaneous products, especially for those who live from hand to mouth.

Taking it all in all the “storing up” of means of subsistence for the workers by the capitalists comes to this.

1) Commodity production presupposes that articles of consumption which one does not produce oneself are available on the market as commodities, or that in general, commodities are produced as commodities.

2) The majority of the commodities consumed by the worker in the final form in which they confront him as commodities, are in fact products of simultaneous labour (they are therefore by no means stored up by the capitalist).

3) In capitalist production, the means of labour and the means of subsistence produced by the worker himself confront him as capital, the one as constant, the other as variable capital; these, the worker’s conditions of production, appear as the property of the capitalist; their transfer from the worker to the capitalist and the partial return of the worker’s product to the worker, or of the value of his product to the worker, is called the “storing up” of circulating capital for the worker. These means of subsistence which the worker must always consume before his product is finished, become “circulating capital” because he [the worker], instead of buying them direct or paying for them with the value either of his past or of his future product ||877|, must first of all receive a draft (money) on it; a draft moreover which the capitalist is entitled to issue only thanks to the worker’s past, present or future product.

Hodgskin is concerned here with demonstrating the dependence of the worker on the coexisting labour of other workers as against his dependence on previous labour,

1) in order to do away with the phrase about “storing up”;

2) because “present labour” confronts capital, whereas the economists always consider previous labour as such to be capital, that is, an alienated and independent form of labour which is hostile to labour itself.

To grasp the all-round significance of contemporaneous labour as against previous labour is however in itself a very important achievement.

Hodgskin thus arrives at the following:

Capital is either a mere name and pretext or it does not express a thing; the social relation of the labour of one person to the coexisting labour of another, and the consequences, the effects of this relationship, are ascribed to the things which make up so-called circulating capital. Despite the fact that the commodity exists as money, its realisation in use-values depends on contemporaneous labour. ([The labour performed in] the course of a year is itself contemporaneous [labour].) Only a small portion of the commodities entering into direct consumption are the product of more than one year’s labour and when they are—such as cattle etc., they require renewed labour every year. All operations requiring more than a year depend on continuous annual production.

“… it is by the command the capitalist possesses over the labour of some men, not by his possessing a stock of commodities, that he is enabled to support and consequently employ other labourers” (Labour Defended etc.,p.14).

Money however gives everyone “command” over “the labour of some men”, over the labour contained in their commodities as well as over the reproduction of this labour, and to that extent therefore over labour itself.

What is really “stored up”, not however as a dead mass but as something living, is the skill of the worker, the level of development of labour. <It is true, however, that the stage of the development of the productivity of labour which exists at any particular time and serves as the starting-point, comprises not only the skill and capacity of the worker, but likewise the material means which this labour has created and which it daily renews. (Hodgskin does not emphasise this because, in opposing the crude views of the economists, it is important for him to lay the stress on the subject—so to speak, on the subjective in the subject—in contrast to the object.)> This is really the primary factor, the point of departure and it is the result of a process of development. Accumulation in this context means assimilation, continual preservation and at the same time transformation of what has already been handed over and realised. In this way Darwin makes “accumulation” through inheritance the driving principle in the formation of all organic things, of plants and animals; thus the various organisms themselves are formed as a result of “accumulation” and are only “inventions”, gradually accumulated inventions of living beings. But this is not the only prerequisite of production. Such a prerequisite in the case of animals and plants is external nature, that is both inorganic nature and their relationship with other animals and plants. Man, who produces in society, likewise faces an already modified nature (and in particular natural factors which have been transformed into means of his own activity) and definite relations existing between the producers. This accumulation is in part the result of the historical process, in part, as far as the individual worker is concerned, transmission of skill. Hodgskin says that as far as the majority of the workers are concerned, circulating capital plays no part in this accumulation.

He has demonstrated that “the stock of commodities” (means of subsistence) “prepared” is always small in comparison with the total amount of consumption and production. On the other hand, the degree of skill of the existing population is always the pre-condition of production as a whole; it is therefore the principal accumulation of wealth and the most important result of antecedent labour; its form of existence, however, is living labour itself.

||878| “…all the effects usually attributed to accumulation of circulating capital are derived from the accumulation and storing up of skilled labour; and, […] this most important operation is performed, as far as the great mass of labourers is concerned without any circulating capital whatever” (op. cit., p. 13).

With regard to the assertion of the economists that the number of workers (and therefore the well-being or poverty of the existing working population) depends on the amount of circulating capital available, Hodgskin comments correctly, as follows:

“… the number of labourers must at all times depend on the quantity of circulating capital; or, as I should say, on the quantity of the products of coexisting labour, which labourers are allowed to consume” (op. cit., p. 20).

What is attributed to circulating capital, to a stock of commodities, is the effect of “coexisting labour”.

In other words, Hodgskin says that the effects of a certain social form of labour are ascribed to objects, to the products of labour; the relationship itself is imagined to exist in material form. We have already seen that this is a characteristic of labour based on commodity production, on exchange-value, and this quid pro quo is revealed in the commodity, in money (Hodgskin does not see this), and to a still higher degree in capital. The effects of things as materialised aspects of the labour process are attributed to them in capital, in their personification, their independence in respect of labour. They would cease to have these effects if they were to cease to confront labour in this alienated form. The capitalist, as capitalist, is simply the personification of capital, that creation of labour endowed with its own will and personality which stands in opposition to labour. Hodgskin regards this as a pure subjective illusion which conceals the deceit and the interests of the exploiting classes. He does not see that the way of looking at things arises out of the actual relationship itself; the latter is not an expression of the former, but vice versa. In the same way, English socialists say “We need capital, but not the capitalists”. But if one eliminates the capitalists, the means of production cease to be capital.

***

<The “Verbal Observer”, Bailey, and others remark that “value”, “valeur” express a property of things. In fact the terms originally express nothing but the use-value of things for people, those qualities which make them useful or agreeable etc. to people. It is in the nature of things that “value”, “valeur”, “Wert” can have no other etymological origin. Use-value expresses the natural relationship between things and men, in fact the existence of things for men. Exchange-value, as the result of the social development which created it, was later superimposed on the word value, which was synonymous with use-value. It [exchange-value] is the social existence of things.

The Sanskrit—Wer [means] cover, protect, consequently respect, honour and love, cherish. From these the adjective Wertas (excellent, respectable) is derived; Gothic, wairths; Old German, Old Frankish, wert; Anglo-Saxon, weorth, vordh, wurth; English, worth, worthy; Dutch, waard, waardig; Alemanic, werth; Lithuantan, wertas (respectable, precious, dear, estimable).

The Sanskrit, wertis; Latin, virtus; Gothic, wairthi; German, Werth[v] [Chavée, Essai d’étymologie philosophique, Brussels, 1844, p. 176].

The value of a thing is, in fact, its own virtus[w], while its exchange-value is quite independent of its material qualities.

The Sanskrit “Wal [means] to cover, to fortify; [Latin] vallo,[x] valeo,[y] vallus[z]: that which protects and defends, valor is the power itself.” Hence valeur, value. “Compare Wal with the German walle, walte[aa] and English wall, wield” [op. cit., p. 70].)

***

Hodgskin now turns to fixed capital. It is productive power which has been produced and, in its development in large-scale industry, it is an instrument which social labour has created.

As far as fixed capital is concerned:

“… all instruments and machines are the produce of labour. […] As long as they are merely the result of previous labour, and are not applied to their respective uses by labourers, they do not repay the expense of making them. […] most of them diminish in value from being kept. […] Fixed capital does not derive its utility from previous, but present labour; and does not bring its owner a profit because it has been stored up, but because it is a means of obtaining command over labour” ([Thomas Hodgskin,] Labour Defended etc., pp. 14-15).

Here at last, the nature of capital is understood correctly.

||879| “After any instruments have been made, what do they effect? Nothing. On the contrary, they begin to rust or decay unless used or applied by labour.” “Whether an instrument shall be regarded as productive capital or not, depends entirely on its being used, or not, by some productive labourer” (loc. cit., pp. 15-16).

“One easily comprehends why […] the road-maker should receive some of the benefits, accruing only to the road-user; but I do not comprehend why all these benefits should go to the road itself, and be appropriated by a set of persons who neither make nor use it, under the name of profit for their capital” (loc. cit., p. 16).

“Its vast utility does[bb] not depend on stored up iron and wood, but on that practical and living knowledge of the powers of nature which enables some men to construct it, and others to guide it” (loc. cit., p. 17).

“Without knowledge they” (the machines) “could not be invented, without manual skill and dexterity they could not be made, and without skill and labour they could not be productively used. But there is nothing more than knowledge, skill, and labour requisite, on which the capitalist can found a claim to any share of the produce” (loc. cit., p. 18).

“After he” (man) “has inherited the knowledge of several generations, and when he lives congregated in great masses, he is enabled by his mental faculties to complete […] the work of nature…” (loc. cit., p. 18).

“… it is not […] the quantity but the quality of the fixed capital on which the productive industry of a country depends. […] fixed capital as a means of nourishing and supporting men, depends for its efficiency, altogether on the skill of the labourers, and consequently the productive industry of a country, as far as fixed capital is concerned, is in proportion to the knowledge and skill of the people” (loc. cit., pp. 19-20).

[e)] Compound Interest: Fall in the Rate of Profit Based on This

“A mere glance must satisfy every mind that simple profit does not decrease but increase in the progress of society—that is, the same quantity of labour which at any former period produced 100 quarters of wheat, and 100 steam-engines, will now produce somewhat more [… ] In fact, also, we find that a much greater number of persons now live in opulence on profit in this country than formerly. It is clear, however, that no labour, no productive power, no ingenuity, and no art can answer the overwhelming demands of compound interest. But all saving is made from the revenue” (that is from simple profit) “of the capitalist, so that actually these demands are constantly made, and as constantly the productive power of labour refuses to satisfy them. A sort of balance is, therefore, constantly struck” (loc. cit., p. 23).

For example, if the profit were always accumulated, a capital of 100 at 10 per cent would amount to something like 673, or—since a little more or less makes no difference here—say 700, in 20 years. Thus the capital will have multiplied itself sevenfold over a period of 20 years. According to this yardstick, if only simple interest were paid, it would have to be 30 per cent per annum instead of 10 per cent, that is, three times as much profit, and the more we increase the number of years that elapse, the more the rate of interest or the rate of profit calculated at simple interest per annum will increase, and this increase is the more rapid, the larger the capital becomes.

In fact, however, capitalist accumulation is nothing but the reconversion of interest into capital (since interest and profit for our purpose, i.e., for the purpose of our calculation, are identical). Thus it is compound interest. First there is a capital of 100; it yields 10 per cent profit (or interest). This is added to the capital which is now 110. This now becomes the capital. The interest on this amount is therefore not simply interest on a capital of 100 but interest on 100 capital plus 10 interest. That is compound interest. Thus, at the end of the second year, we have (100 capital + 10 interest) +10 interest+1 interest=(100 capital+ 10 interest)+11 interest=121. This is the capital at the beginning of the third year. In the third year we get (100 capital+10 interest)+11 interest+ 12¹/₁₀ interest, so that at the end of it the capital is 133¹/₁₀

||880| We have:

Capital	Interest	Total
First year 100	10	110
Second year 100 + 10 = 110	10 + 1’*	121
Third year 100 + 20 + 1 = 121	10 + 2’ + ¹/₁₀’	133¹/₁₀
Fourth year 100 + 30 + 3 ¹/₁₀ = 133¹/₁₀	10 + 3³¹/₁₀₀’	146⁴¹/₁₀₀
Fifth year 100 + 40 + 6⁴¹/₁₀₀ =146⁴¹/₁₀₀	10 + 4⁶⁴¹/_1,000’	161⁵¹/_1,000

etc.

In	the	second	year	the	capital	comprises	10 interest (simple)
"	"	third	"	"	"	"	21 interest
"	"	fourth		"	"	"	"	31¹/₁₀ interest
"	"	fifth	"	"	"	"	46⁴¹/₁₀₀	interest
"	"	sixth	"	"	"	"	61⁵¹/_1,000	"
"	"	seventh	"	"	"	"	77^1,561/_10,000	"
"	"	eighth		"	"	"	"	94^87,171/_100,000	"
[In	the	ninth	year	the	capital	comprises	114^358,881/_1,000,000	interest]

*The sign ‘ indicates interest on interest.

In other words, more than half the capital is made up of interest in the ninth year and the portion of capital consisting of interest thus increases in geometrical progression.

We have seen that over 20 years, capital increased sevenfold, whereas, even according to the “most extreme” assumption of Malthus, the population can only double itself every twenty-five years. But let us assume that it doubles itself in twenty years, and therefore the working population as well. Taking one year with another, the interest would have to be 30 per cent—three times greater than it is. If one assumes, however, that the rate of exploitation remained unchanged, in 20 years the doubled population would only be able to produce twice as much labour as it did previously (and [the new generation] would be unfit for work during a considerable part of these 20 years, scarcely during half this period would it be able to work, in spite of the employment of children); it would therefore produce only twice as much surplus labour, but not three times as much.

The rate of profit (and consequently the rate of interest) is determined:

1) If the rate of exploitation is assumed to be constant—by the number of workers in employment, by the absolute mass of workers employed, that is, by the growth of the population. Although this number increases, its ratio to the total amount of capital employed declines with the accumulation of capital and with industrial development (consequently the rate of profit declines if the rate of exploitation remains the same). Likewise the population does not by any means [increase] in the same geometrical progression as the computed compound interest. The growth of the population at a given stage of industrial development is the explanation for the increase in the amount of surplus-value and of profit, but also for the fall in the rate of profit.

2) [By] the absolute length of the “normal” working-day, that is, by increasing the rate of surplus-value. Thus the rate of profit can increase as a result of the extension of labour-time beyond the normal working-day. However, this has its physical and—by and large—its social limits. That in the same measure as workers set more capital in motion, the same capital commands more absolute labour-time ||881| is out of the question.

3) If the normal working-day remains the same, surplus labour can be increased relatively by reducing the necessary labour-time and reducing the prices of the necessaries which the worker consumes, in comparison with the development of the productive power of labour. But this very development of productive power reduces variable capital relative to constant. It is physically impossible that the surplus labour-time of, say, two men who displace twenty, can, by any conceivable increase of the absolute or relative [surplus] labour-time, equal that of the twenty. If each of the twenty men only work 2 hours of surplus labour a day, the total will be 40 hours of surplus labour, whereas the total life span of the two men amounts only to 48 hours in one day.

The value of labour-power does not fall in the same degree as the productivity of labour or of capital increases. This increase in productive power likewise increases the ratio between constant and variable capital in all branches of industry which do not produce necessaries (either directly or indirectly) without giving rise to any kind of alteration in the value of labour. The development of productive power is not even. It is in the nature of capitalist production that it develops industry more rapidly than agriculture. This is not due to the nature of the land, but to the fact that, in order to be exploited really in accordance with its nature, land requires different social relations. Capitalist production turns towards the land only after its influence has exhausted it and after it has devastated its natural qualities. An additional factor is that, as a consequence of landownership, agricultural products are expensive compared with other commodities, because they are sold at their value and are not reduced to their cost-price. They form, however, the principal constituent of the necessaries. Furthermore, if one-tenth of the land is dearer to exploit than the other nine-tenths, these latter are likewise hit “artificially” by this relative barrenness, as a result of the law of competition.

The rate of profit would in fact have to grow if it is to remain constant while accumulation of capital is taking place. The same worker as long as capital yields 10 of surplus labour must, as soon as interest accumulates on interest and thus increases the capital employed, produce threefold, fourfold, fivefold in progression of compound interest, which is nonsense.

The amount of capital which the worker sets in motion, and whose value is maintained and reproduced by his labour, is something quite different from the value which he adds, and therefore from the surplus-value. If the amount of capital is 1,000 and the labour added equals 100, then the capital reproduced amounts to 1,100. If the capital is 100 and the labour added is 20, then the capital reproduced is 120. The rate of profit in the first case is 10 per cent and in the second, it is 20 per cent. Nevertheless, more can be accumulated from 100 than from 20. Thus the flow of capital or its “accumulation” continues (apart from the reduction in its value as a result of the increase in productive power) in proportion to the force it already possesses, but not in proportion to the size of the rate of profit. This explains that accumulation—its amount—may increase in spite of a falling rate of profit, apart from the fact that, while productivity rises, a larger portion of the revenue can be accumulated, even when the rate of profit declines, than when there is a higher rate of profit together with lower productivity. A high rate of profit—insofar as it is based on a high rate of surplus-value—is possible if very long hours are worked, although the labour is unproductive. It is possible because the workers’ needs, and therefore the minimum wage, are small, although the labour is unproductive. The lack of energy with which the labour is performed will correspond to the low level of the minimum wage. Capital is accumulated slowly in both cases despite the high rate of profit. The population is stagnant and the labour-time which the product costs is high, although the wages received by the workers are small.

||882| I have explained the decline in the rate of profit in spite of the fact that the rate of surplus-value remains the same or even rises, by the decrease of the variable capital in relation to the constant, that is, of the living, present labour in relation to the past labour which is employed and reproduced. Hodgskin and the man who wrote The Source and Remedy of the National Difficulties explain it by the fact that it is impossible for the worker to fulfil the demands of capital which accumulates like compound interest.

“… no labour, no productive power, no ingenuity, and no art can answer the overwhelming demands of compound interest. But all saving is made from the revenue of the capitalist” (that is from simple profit) “so that actually these demands are constantly made, and as constantly the productive power of labour refuses to satisfy them. A sort of balance is, therefore, constantly struck” (op. cit., p. 23).

In its general sense, this amounts to the same thing. If I say that, as capital accumulates, the rate of profit declines because constant capital increases in relation to variable capital, it means that, disregarding the specific form of the different portions of capital, the capital employed increases in relation to the labour employed. [The rate of] profit falls not because the worker is exploited less, but because altogether less labour is employed in relation to the capital employed.

For example, let us assume that the ratio of variable to constant capital is 1:1. Then, if the total capital amounts to 1,000, c [constant capital] will be 500, and v [variable capital] likewise 500. If the rate of surplus-value is 50 per cent, then 50 per cent of 500 is 50×5, or 250. Thus the rate of profit on 1,000 yields a profit of 250, or ²⁵⁰/_1,000 or ²⁵/₁₀₀ or ¹/₄ which is 25 per cent. If the total capital is 1,000 and if c equals 750 and v 250, then at 50 per cent [the rate of surplus-value] 250 will yield 125.

But ¹²⁵/_1,000 comes to ¹/₈, or 12¹/₂ per cent.

But in comparison with the first case [less] living labour is employed in the second case. If we assume that the annual wage of the worker is £25, then in the first case £500 [wages] will employ 20 workers; in the second case £250 wages will employ 10 workers. The same capital [£1,000] employs 20 workers in one case and only 10 in the other. In the first case, the ratio of total capital to the number of working-days is as 1,000:20; in the second as 1,000:10. In the first case, for each of the 20 workers £50 capital (constant and variable) is used (for 20×50=500×2=1,000). In the second case, the capital employed per individual worker is £100 (for 100×10=1,000). Nevertheless, in both cases, the capital which is allocated to wages is, pro rata, the same.

The formula I have given provides a new ground for explaining why, with accumulation, less workers are employed by the same amount of capital or, what amounts to the same thing, why a greater amount of capital has to be used for the same amount of labour. It comes to the same thing if I say that one worker is employed for a capital outlay of 50 in the one case, and one worker for a capital outlay of 100 in the other, that therefore only half the number of workers is employed by a capital of 50; in other words, if I say that in one case there is one worker for 50 capital and only half a worker for 50 capital in the other, or if I say that in one case 50 capital is used by one worker and in the other case 50x2 capital is used by one worker.

This latter formula is the one used by Hodgskin and others. According to them, accumulation means in general the demand for compound interest; in other words, that more capital is expended on one worker and that he has therefore to produce more surplus labour proportionally to the amount of capital expended on him. Since the capital expended on him increases at the same rate as compound interest, but on the other hand, his labour-time has very definite limits which even relatively no [development of the] productive powers can reduce in accordance with the demands of this compound interest “a sort of balance is constantly struck”. “Simple profit” remains the same, or rather it grows. (This is in fact the surplus labour or surplus-value.) But as the result of the accumulation of capital it is compound interest which is disguised in the form of simple interest.

||883| It is clear furthermore that if compound interest equals accumulation, then, apart from the absolute limits of accumulation, the growth of this interest depends on the extent, the intensity, etc., of the accumulation process itself, that is, on the mode of production. Otherwise compound interest is nothing but appropriation of the Capital (property) of others in the form of interest as was the case in Rome and in general with usurers.

Hodgskin’s view is as follows: Originally £50 capital, for example, falls to the share of one worker, on which he produces, let us say, a profit of [£]25. Later, as a result of the conversion of a part of the interest into capital and of the fact that this process repeats itself again and again, a capital of £200 is allocated to the worker. If the entire interest of 50 per cent received per annum was always capitalised, the process would be complete in less than four years. Just as the worker produced [a profit of] 25 on [a capital of] 50, he is now expected to produce [a profit of] 100 on a capital of 200, or four times as much. But that is impossible. To do that either the worker would have to work four times as long, that is, 48 hours a day if he worked 12 hours previously, or the value of labour would have to fall by 75 per cent as a result of increased productivity of labour.

If the working-day is 12 hours, £25 the [annual] wage, and the worker produces £25 profit [per annum], then he has to work as much for the capitalist as he does for himself. That is for 6 hours or half the working-day. In order to produce 100, he would have to work 4×6 hours for the capitalist in a 12-hour working-day—which is nonsense. Let us assume that the working-day is lengthened to 15 hours, then the worker still cannot produce 24 hours work in 15 hours. And still less can he work for 30 hours, which is what would be necessary, since [he would have to work] 24 hours for the capitalist and 6 for himself. If he worked the whole of his working-time for the capitalist, he would be able to produce only £50; he would only double the amount of interest, that is, he would produce 50 profit on a capital of 200, whereas he produced £25 for £50 capital. The rate of profit is 50 per cent in the second case and 25 per cent in the first. But even this is impossible, since the worker must live. No matter how much productive power increases, if, as in the above example, the value of 12 hours is 75, then that of 24 hours adds up to 2×75, or 150. And since the worker must live, he can never produce 150 profit, still less 200. His surplus labour is always a part of his working-day, from which it does not at all follow, as Mr. Rodbertus thinks, that profit can never reach 100 per cent. It can never be 100 per cent if it is calculated on the working-day as a whole (for it is itself included in it). But it can most certainly be 100 per cent in relation to that part of the working-day which is paid for.

Let us take the above example of 50 per cent.

Capital		Surplus-value	Rate of surplus-value	Rate of Profit
constant	variable
25	25	25	100 per cent	50 percent

Here the profit, half a working-day, is equal whole [product].

||884| If the worker worked three-quarters day for the capitalist then:

Capital		Surplus-value	Rate of surplus-value	Rate of Profit
constant	variable
25	12¹/₂	37¹/₂	300 per cent	100 percent
Total capital 37¹/₂

[calculated on a capital] of 100

Capital		Surplus-value	Rate of surplus-value	Rate of Profit
constant	variable
66 ²/₃	33 ¹/₃	100	300 per cent	100 percent
Total capital 100

Let us examine this a little more closely and see what is implied by the view that [the rate of] profit falls because, in consequence of progressive accumulation, it does not constitute simple profit (consequently the rate of exploitation of the worker does not decline but, as Hodgskin says, increases) but compound profit and it is impossible for labour to keep pace with the demands of compound interest.

It has to be noted first of all that this has to be defined in more detail if it is to make any sense at all. Regarded as a product of accumulation (that is, of the appropriation of surplus labour)—and this approach is necessary if one considers reproduction as a whole—all capital is made up of profit (or of interest, if this word is considered to be synonymous with profit and not with interest in the strict sense). If the rate of profit is 10 per cent, then this is “compound interest”, compound profit. And it would be impossible to see how 10 to 100 could—in economic terms—differ from 11 to 110. So what emerges is that “simple profit” too is impossible, or at least that simple profit must also decline, because, in fact, simple profit is made up in exactly the same way as compound profit. If one narrows the problem, that is, considers solely interest-bearing capital, then compound interest would swallow up profit and more than profit; and the fact that the producer (capitalist or not) has to pay the lender compound interest means that sooner or later, in addition to profit he has to pay him part of his capital as well.

Thus it should be noted first of all that Hodgskin’s view only has meaning if it is assumed that capital grows more rapidly than population, that is, than the working population. (Even this latter is a relative growth. It is in the nature of capitalism to overwork one section of the working population while it turns another into paupers.) If the population grows at the same rate as capital, then there is no reason whatsoever why I should not be able to extract from 8x workers with £800 the [same rate of] surplus labour that I can extract from x workers with £100. ||885| Eight times 100 C makes no greater demand on 8 times x workers than 100 C on x workers. Thus “Hodgskin’s” argument becomes groundless. (In reality, things turn out differently. Even if the population grows at the same rate as capital, capitalist development nevertheless results in one part of the population being made redundant, because constant capital develops at the expense of variable capital.)

<“…it is very material, with reference to labour, whether you distribute them” (goods) “so as to induce a greater supply of labour or a less: whether you distribute them where they will be conditions for labour, or where they will be opportunities for idleness” (An Inquiry into those Principles, respecting the Nature of Demand and the Necessity of Consumption, lately advocated by Mr. Malthus etc., London, 1821, p. 57).

“… that increased supply of labour is promoted by the increased numbers of mankind…”(loc. cit., p. 58).

“The not being able to command so much labour as before, too, is only important where that[cc] labour would produce no more than before. If labour has been rendered more productive, production will not be checked, though the existing mass of commodities should command less labour than before”(loc. cit., p. 60).

(This is directed against Malthus. True, production would not be checked, but the rate of profit would. These cynical propositions stating that a “mass of commodities commands labour”, reflect the same cynicism which finds expression in Malthus’s explanation of value[dd]; command of the commodity over labour is very good and is absolutely characteristic of the nature of capital.)

The same author makes the following correct observation directed against West:

“The author of the Essay […] observes[ee] […] that more will be given for labour when there is most increase of stock, and that […] will be when profits on stock are highest. ‘The greater the profits of stock’, he adds, ‘the higher will be the wages of labour.’ The fault of this is, that a word or two is left out. ‘The greater have been the profits of stock’ … ‘the higher will be the wages of labour’… The high profits and the high wages are not simultaneous; they do not occur in the same bargain; the one counteracts the other, and reduces it to a level. It might as well be argued, ‘the supply of a commodity is most rapid when the price is highest, therefore, large supply and high price go together’. It is a mixing up of cause and effect” (op. cit., pp. 100-01).>

Hodgskin’s proposition, therefore, has meaning only if, as a result of the process of accumulation, more capital is set in motion by the same workers, or if the capital grows in relation to labour. That is, if, for example, the capital was 100 and becomes 110 by accumulation, and if the same worker who produced a surplus-value of 10, is to produce a surplus-value of 11, corresponding to the growth of capital, i.e., compound interest. So that it is not simply the same capital he set in motion previously which, after its reproduction, is to yield the same profit (simple profit) but this capital has been increased by his surplus labour [so that] he has to provide surplus labour for the original capital (or its value) and also for his own accumulated (i.e. capitalised) surplus labour. And since this capital increases every year, the same worker would constantly have to furnish more labour.

It is however only [under the following conditions] possible for more capital to be applied per worker:

First. If the productive power of labour remains the same, then this is only possible if the worker prolongs his working-time absolutely, i.e., for example, if he works 15 hours instead of 12 hours, or if he works more intensively and performs 15 hours’ labour in 12 hours, does 5 hours’ labour in 4 hours or 1 hour’s labour in ⁴/₅ of an hour. Since he reproduces his means of subsistence in a definite number of hours, then, in this case, three hours of labour are won for the capitalist in the same way as if the productive power of labour had been increased, while, in fact, it is labour which has been increased, not its productive power. If the intensification of labour were to become general, then the value of commodities would fall in proportion to the reduced labour-time which they cost. The degree of intensity would become the average [intensity of labour], its natural quality. If, however ||886| , this only occurs in particular spheres, then it amounts to more complex labour, simple labour raised to a higher power. Less than an hour of more intensive labour then counts as much—and creates as much value—[as an hour of] the more extensive labour. For example, in the above case, ⁴/₅ of an hour [produces] as much as ⁵/₅, or an hour.

Both the extension of labour-time and the increase of labour through its greater intensification by means of the compression of the pores of Labour as it were, have their limits (although the London bakers, for example, regularly work 17 hours [a day] if not more), very definite, physical, limitations, and it is when encountering these that compound interest—composite profit—ceases.

Within these limitations the following applies:

If the capitalist pays nothing for the extension or intensification of labour, then his surplus-value (his profit as well, provided there is no change in the value of the constant capital, for we assume that the mode of production remains the same)—and, in accordance with the proviso, his profit—increases more rapidly than his capital. He pays no necessary labour for the capital which has been added.

If he pays for the surplus labour at the same rate as previously, then the growth of the surplus-value is proportionate to the increase in capital. The profit grows more rapidly. For there is a more rapid turnover of fixed capital, while the more intensive use of the machinery does not cause the wear and tear to increase at the same rate. There is a reduction of expenditure on fixed capital, for less machinery, workshops etc. are required for 100 workers who work longer hours than for 200 workers employed simultaneously. Likewise fewer overseers, etc. (This gives rise to a most satisfactory situation for the capitalist, who is able to expand or contract his production without hindrance, in accordance with the market conditions. In addition, his power grows, since that portion of labour which is over-employed, has its counterpart in an unemployed or semi-employed reserve army, so that competition amongst the workers increases.)

Although there is in this case no change in the purely numerical ratio between necessary labour and surplus labour—this is however the only case where both can simultaneously increase in the same proportion—the exploitation of labour has nevertheless grown, both by means of an extension of the working-day and by its intensification (condensation) provided the working-day is not shortened at the same time (as with the 10 Hours Bill). The period for which the worker is fit to work is reduced and his labour-power is exhausted in a much greater measure than his wages increase and he becomes even more of a work machine. But disregarding the latter aspect, if he lives for 20 years working a normal working-day and only 15 years when his working-day is extended and intensified, then he sells the value of his labour-power in 15 years in the latter case and in 20 years in the former. In one case it has to be replaced in 15 years, in the other, in 20 years.

A value of 100 which lasts for 20 years is replaced if 5 per cent is paid on it annually, for 5×20=100. A value of 100 which lasts 15 years is replaced if 6¹⁰/₁₅ or 6²/₃ per cent is paid on it annually. But in the given case, the worker receives for 3 hours of additional labour only an amount equivalent to the daily value of his labour calculated over 20 years. Assuming that he works 8 hours necessary labour and 4 hours surplus labour, then he receives two-thirds of each hour for ^12×2/₃=8 And in the same way he receives 2 out of the 3 hours over-time that he works. Or two-thirds of each hour. But this is only the value of his hourly labour-power on the assumption that it will last for 20 years. If he uses it up in 15 years, its value [per hour] increases.

Anticipation of the future—real anticipation—occurs in the production of wealth only in relation to the worker and to the land. The future can indeed be anticipated and ruined in both cases by premature over-exertion and exhaustion, and by the disturbance of the balance between expenditure and income. In capitalist production this happens to both the worker and the land. As far as so-called anticipation is concerned, in relation to the national debt for example, Ravenstone remarks with justice:

||887| “In pretending to stave off the expenses of the present hour to a future day, in contending that you can burthen posterity to supply the wants of the existing generation, they in reality assert the monstrous proposition[ff] that you can consume what does not yet exist, that you can feed on provisions before their seeds have been sown in the earth” (Piercy Ravenstone, [Thoughts on the Funding System, and Its Effects, London, 1824], p. 8.)

“All the wisdom of our statesmen will have ended in a great transfer of property from one class of persons to another, in creating an enormous fund for the reward of jobs and peculation” (loc. cit., p. 9).

It is different in the case of the worker and the land. What is expended here exists as δίναμις[gg] and the life span of this δίναμις is shortened as a result of accelerated expenditure.

Finally, if the capitalist is forced to pay more for over-time than for normal working-time, then, according to the facts outlined above, this is by no means an increase in wages, but only compensation for the increased value of over-time—and in reality over-time pay is rarely sufficient to cover this. In fact, in order to pay for the increased wear and tear of the labour-power, when over-time is worked, a higher rate ought to be paid for every working hour not merely for the additional hours.

Thus there is in any case an increased exploitation of labour. At the same time, as a result of the accumulation of capital, a reduction in surplus-value takes place at all events and also a decline in the rate of profit, insofar as this is not counteracted by saving on constant capital. |887||

||887| This is therefore a situation where, in consequence of the accumulation of capital—of the appearance of compound profit—the rate of profit must decline. If on a capital of [£] 300 (the original amount) the rate of profit was 10 per cent (that is profit came to [£] 30), and if for an additional [£] 100 it is 6 per cent, then profit is [£] 36 for [£] 400. Thus on the whole it is 9 for 100. And the rate of profit has fallen from 10 per cent to 9 per cent.

But, as has been stated, on this basis (if the productivity of labour remains the same) not only must the profit on additional capital fall, hut at a certain point it must cease altogether, thus the whole accumulation based on this compound profit would be stopped. In this case, the decline in profit is linked with increased exploitation of labour and the cessation of profit at a certain point is not due to the worker or someone else receiving the whole product of his labour, hut to the fact that it is physically impossible to work over and above a certain amount of labour-time or to increase the intensity of labour beyond a certain degree.

Secondly. The only other case, where, with the number of workers remaining constant, more capital is applied per worker, and therefore the additional capital can be laid out and used for the increased exploitation of the same number ||888| of workers, occurs when the productivity of labour increases, i.e. the method of production is changed. This presupposes a change in the organic ratio between constant and variable capital. In other words, the increase in the capital in relation to labour is here identical with the increase of constant capital as compared with variable capital and, in general, with the amount of living labour employed.

This is where Hodgskin’s view merges with the general law which I have outlined.

The surplus-value, i.e. the exploitation of the worker, increases, but, at the same time, the rate of profit falls because the variable capital declines as against the constant capital, because in general, the amount of living labour falls relatively in comparison with the amount of capital which sets it in motion. A larger portion of the annual product of labour is appropriated by the capitalist under the signboard of capital, and a smaller portion under the signboard of profit.

The fact that the (proportionally) declining quantity of labour is not fully offset by increased productivity, or that the ratio of surplus labour to the capital expended does not increase at the same rate as the relative amount of labour employed declines, is due partly to the fact that the development of the productive power of labour reduces the value of labour, the necessary labour, only in certain capital investment spheres, and that, even in these spheres, it does not develop uniformly, and that factors exist which nullify this effect; for example, the workers themselves, although they cannot prevent reductions in (real) wages, will not permit them to be reduced to the absolute minimum; on the contrary, they achieve a certain quantitative participation in the general growth of wealth.

But this growth of surplus labour too is relative, [and is only possible] within certain limits. In order to make this growth correspond to the demands of compound interest, the necessary labour-time in this case would have to be reduced to zero in the same way as [the surplus labour-time] had to be extended endlessly in the case considered previously.

The rise and fall in the rate of profit—insofar as it is determined by the rise or fall of wages resulting from the conditions of demand and supply [in the labour market], or caused by the temporary rise or fall in the prices of necessaries compared with those of luxuries, as a result of the changes in demand and supply and the rise or fall in wages to which this leads—has as little to do with the general law of ||889| the rise or fall in the profit rate as the rise or fall in the market prices of commodities has to do with the determination of value in general. This has to be analysed in the chapter on the real movement of wages. If the conditions of demand and supply are favourable to the workers and wages rise, then it is possible (but by no means certain) that the prices of certain necessaries, especially food, will rise correspondingly for a time. The author of the Inquiry into Those Principles etc. rightly remarks in this connection:

In this case there will be “… an increase of demand for necessaries, in proportion to that for superfluities, as compared with what would have been the proportion between these two sorts of demand, if he had exerted that command” (i.e., the capitalist, his command over commodities) “to procure things for his own consumption. Necessaries will thereby exchange for more of things in general… And, in part, at least, these necessaries will be food” (op. cit., p. 22).

He then correctly expresses the Ricardian view as follows:

“At all events, then, the increased price of corn was not the original cause of that rise of wages which made profits fall, but, on the contrary, the rise of wages was the cause of the increased price of corn at first, and the nature of land, yielding less and less proportional returns to increased tillage, made part of that increase of price permanent, prevented a complete reaction from taking place through the principle of population” (loc. cit., p. 23).

Hodgskin and the author of The Source and Remedy etc. since they explain the fall of profits by the impossibility of living labour to fulfil the demands of compound interest, and although they do not analyse this, are much nearer the truth than Smith and Ricardo, who explain the fall of profits by the rise in wages, one of them, [by the rise in] real and nominal wages, the other [by the rise in] nominal wages, with rather a decrease of real wages. Hodgskin and all the other proletarian opponents have enough common sense to emphasise the fact that the proportional number of those who live on profit has increased with the development of capital.

[f) Hodgskin on the Social Character of Labour and on the Relation of Capital to Labour]

Now a few concluding passages from Hodgskin’s Labour Defended etc.

The treatment of the exchange-value of the product, hence of the labour embodied in the commodity, as social labour.

“Almost every product of art and skill is the result of joint and combined labour… ”

(This is the result of capitalist production.)

“… So dependent is man on man, and so much does this dependence increase as society advances, that hardly any labour of any single individual … is of the least value but as forming part of the great social task…”

“Wherever the division of labour is introduced […] the judgement of other men intervenes before the labourer can realise his earnings, and there is no longer any thing which we can call natural reward of individual labour. Each labourer produces only some part of a whole, and each part, having no value or utility of itself, there is nothing on which the labourer can seize and say, ‘this is my product, this I will keep to myself’. Between the commencement of any joint operation, such as that of making cloth, and the division of its product among the different persons whose combined exertions have produced it, the judgement of men must intervene several times, and the question is, how much of this joint product should go to each of the individuals whose united labour produced it?” ( [Thomas Hodgskin, Labour Defended etc., London, 1825,] p. 25.)

“… I know no way ||890| of deciding this but by leaving it to be settled by the unfettered judgements of the labourers themselves” (loc. cit., p. 25).

“I must [… ] add that it is doubtful whether one species of labour is more valuable than another; certainly it is not more necessary” (loc. cit., p. 26).

Finally Hodgskin writes about the relation of capital [and labour]:

“Masters […] are labourers as well as their journeymen. In this character their interest is precisely the same as that of their men. But they are also either capitalists or the agents of the capitalist, and in this respect their interest is decidedly opposed to the interest of their workmen” (loc. cit., p. 27).

“The wide spread of education among the journeymen mechanics of this country, diminishes daily the value of the labour and skill of almost all masters and employers, by increasing the numbers of persons who possess their peculiar knowledge” (loc. cit., p. 30).

“But put the capitalist, the oppressive middleman out of view”[hh] then “… it is plain that capital, or the power to employ labour, and coexisting labour, are one; and […] productive capital and skilled labour are also one; consequently capital and a labouring population are precisely synonymous. In the system of nature, mouths are united with hands and with intelligence” (loc. cit., p. 33).

The capitalist mode of production disappears with the form of alienation which the various aspects of social labour bear to one another and which is represented in capital. This is the conclusion arrived at by Hodgskin.

***

The primitive accumulation of capital. Includes the centralisation of the conditions of labour. It means that the conditions of labour acquire an independent existence in relation to the worker and to labour itself. This historical act is the historical genesis of capital, the historical process of separation which transforms the conditions of labour into capital and labour into wage-labour. This provides the basis for capitalist production.

Accumulation of capital on the basis of capital itself, and therefore also on the basis of the relationship of capital and wage-labour, reproduces the separation and the independent existence of material wealth as against labour on an ever increasing scale.

Concentration of capital. Accumulation of large amounts of capital by the destruction of the smaller capitals. Attraction. Decapitalisation of the intermediate links between capital and labour. This is only the last degree and the final form of the process which transforms the conditions of labour into capital, then reproduces capital and the separate capitals on a larger scale and finally separates from their owners the various capitals which have come. into existence at many points of society, and centralises them in the hands of big capitalists. It is in this extreme form of the contradiction and conflict that production—even though in alienated form—is transformed into social production. There is social labour, and in the real labour process the instruments of production are used in common. As functionaries of the process which at the same time accelerates this social production and thereby also the development of the productive forces, the capitalists become superfluous in the measure that they, on behalf of society, enjoy the usufruct and that they become overbearing as owners of this social wealth and commanders of social labour. Their position is similar to that of the feudal lords whose exactions in the measure that their services became superfluous with the rise of bourgeois society, became mere outdated and inappropriate privileges and who therefore rushed headlong to destruction. |XV-890||

[g) Hodgskin’s Basic Propositions as Formulated in His Book—”Popular Political Economy”]

||XVIII-1084| Thomas Hodgskin, Popular Political Economy. Four Lectures delivered at the London Mechanics’ Institution, London, 1827.

“Easy labour is only transmitted skill” (p. 48).

“But as all the advantages derived from the division of labour naturally centre in, and […] belong to the labourers, if they are deprived of them, and in the progress of society those only are enriched by their improved skill who never labour,—this must arise from unjust appropriation; from usurpation and plunder in the party enriched, and from consenting submission in the party impoverished” (op. cit., pp. 108-09).

||1085| “The labourers, to be sure, multiply too rapidly when that multiplication is only compared with the want of the capitalist for their services…”[ii] (op. cit., p. 120).

“Mr. Malthus points out the effects which an increase in the number of labourers has in lessening the share which each one receives of the annual produce—the portion of that distributed amongst them being a definite and determinate quantity, not regulated in any degree by what they annually create” (op. cit., p. 126).

“… labour […] the exclusive standard of value,” but “labour, the creator of all wealth” [is] “not a commodity” (op. cit., p. 186, note).

Regarding the influence of money on the expansion of wealth, Hodgskin remarks correctly:

“As a man can dispose of small portions of produce that is corruptible, for what is incorruptible, he is under no temptation to throw it away; and thus the use of money adds to wealth, by preventing waste” (op. cit., p. 197).

The chief advantage of retail trade derives from the fact that the quantity in which commodities are best produced is not that in which they are best distributed[jj] (op. cit., p. 146).

“Both the theory relative to capital, and the practice of stopping labour at that point where it can produce, in addition to the subsistence of the labourer, a profit for the capitalist, seem opposed to the natural laws which regulate production” (op. cit., p. 238).

With regard to the accumulation of capital, Hodgskin advances roughly the same ideas as those contained in his first book. Nevertheless—for the sake of completeness—we will reproduce the main passages.

“Taking only fixed capital into consideration […] the subject most favourable to the idea of capital aiding production [… ] For this purpose we may distinguish three classes of circumstances under which the effects of an accumulation of capital will be very different. First, if it is made and used by the same persons […][kk] every accumulation in his possession of the instruments he makes and uses, facilitates his labour. The limit to such an accumulation is […] the power of the labourer to make and use the instruments in question.”

“… second, if it be[ll] made and used by different […] persons, who share between them in just proportion the produce of their combined labour.[… ] Capital may be made by one labourer and used by another […] both may[mm] divide the commodity […] in proportion as each has contributed by his labour to produce it… I should rather express this fact, however, by saying that a part of the society employed in making instruments, while another part uses them, is a branch of division of labour which aids productive power and adds to the general wealth. As long as the produce of the two […] classes of labourers.-be[nn] divided between them, the accumulation or[oo] increase of such instruments as they can make and use, is as beneficial as if they were made and used by one person.”

Third, “if it be owned by a class of persons who neither make nor use it [… ] The capitalist being the mere owner of the instruments, is not, as such, a labourer. He in no manner assists production.”

“He acquires possession of the produce of one labourer, which he makes over to another, either for a time—as is the case with most kinds of fixed capital, or for ever, as is the case with wages—whenever he thinks it can be used or consumed for his advantage. He never does allow the produce of one labourer, when it comes into his possession, to be either used or consumed by another, unless it is for his benefit. He employs or lends his property to shore the produce, or natural revenue, of labourers; and every accumulation of such property in his hands is a mere extension of his power over the produce of labour, and retards the progress of national wealth, […] this [is] at present the case… When the capitalist, being. the owner of all the produce, will allow labourers neither to make nor use instruments, unless he obtains a profit over and above the subsistence of the labourer, it is plain that bounds are set to productive labour much within what Nature prescribes. In proportion as capitol in the hands of a third party is accumulated, so the whole amount of profit required by the capitalist increases, and so there arises an artificial check to production and population… In the present state of society, the labourers being la no case the owners of capital, every accumulation of it adds to the amount of profit demanded from them, and extinguishes all that labour which would only procure the labourer his comfortable subsistence… when it is admitted that labour produces all things, even capital, it is nonsense to attribute productive power to the instruments labour makes and uses…”

“…wages do not, like instruments, facilitate production.[pp] […] labour, not capital, pays all wages” (op. cit., pp. 243-47).

||1086| “…the greater part of […] the advances of capitalists consists of such promises.”[qq]

“…the invention and employment of paper-money had done nothing else but show [the incorrectness of the notion] that capital is something saved[rr] [… ] As long as the capitalist, to realise his wealth, or command over other people’s labour, was obliged to have in his possession an actual accumulation of the precious metals or of commodities, we might have continued to suppose,[ss] that accumulation of capital was the result of an actual saving, and that on it depended the progress of society. But when paper-money and parchment securities were invented—when the possessor of nothing but such a piece of parchment received an annual revenue in pieces of paper with which he obtained whatever was necessary for his own use and consumption, and not giving away all the pieces of paper, was richer at the end of the year than at the beginning, or was entitled next year to receive a still greater number of pieces of paper, obtaining a still greater command over the produce of labour, it became evident […] that capital was not any thing saved; and that the individual capitalist did not grow rich by an actual and material saving, but by doing something which enabled him … to obtain more of the produce of other men’s[tt] labour” (loc. cit., p. 248, note).

“The master manufacturer has either money or paper with which he pays wages; those wages his labourer exchanges for the produce of other labourers, who will not keep the wages, whether money or paper; and it is returned to the manufacturer, who gives in exchange for it the cloth which his own labourers have made. With it he again pays wages, and the money or paper again goes the same round …”

“It ascribes to his” (the capitalist’s) “property merely, whether he employ it to pay wages, or whether it consist in useful instruments, all that vast assistance, which knowledge and skill, when realised in machinery, give to labour. […] the united labours of the miner, the smelter, the smith, the engineer, the stoker, and of numberless other persons, and not the lifeless machines, perform whatever is done by steam engines… By the common mode of speaking, the productive power of this skill is attributed to its visible products, the instruments, the mere owners of which, who neither make nor use them, imagine themselves to be very productive persons…” (loc. cit., pp. 248-51).

With regard to his polemic against “the danger of forcing […] capital out of the country” [loc. cit., p. 253], and against the interest of capital as a necessary stimulus for [the development of] industry, or concerning the savings theory, see IX, 47. To be included in the chapter on the vulgar economists.

“As their numbers are increased,[uu] both increased production and consumption take place, which is all that is ever meant by the terms accumulation or increase of national wealth” (op. cit., p. 257). |XVIII-1086||

[h) Hodgskin on the Power of Capital and on the Upheaval in the Right of Property]

|XIII-670a| [Hodgskin,] The Natural and Artificial Right of Property Contrasted, London, 1832.

“At present, all the wealth of society goes first into the possession of the capitalist, and even most of the land has been purchased by him; he pays the landowner his rent, the labourer his wages, the tax and tithe gatherer their claims, and keeps a large, indeed the largest and continually augmenting share, of the annual produce of labour for himself. The capitalist may now be said to be the first owner of all the wealth of the community; though no law has conferred on him the right to this property” (p. 98).

“… this change has been effected by the taking of interest on capital, and by the process of compound interest; and it is not a little curious, that all the lawgivers of Europe, endeavoured to prevent this by statutes, viz., statutes against usury” (loc. cit., p. 98, note).

“… the power of the capitalist over all the wealth of the country, is a complete change in the right of property, and by what law, or series of laws, was it effected?” (loc. cit., p. 99). |XIII-670a||

|X-441| J. F. Bray, Labour’s Wrongs and Labour’s Remedy, etc., Leeds, 1839.

Since human existence is determined by labour, and labour presupposes instruments of labour … “the great field for all exertion and the raw material of all wealth—the earth—is[vv] the common property of all its inhabitants” (p. 28).

“… life is dependent upon food, […] food […] upon labour […], those dependencies are absolute […] therefore, if labour be evaded by any human being, it can be thus evaded by individuals only on the condition of increased labour by the mass” (loc. cit., p. 31).

“… all the wrongs and the woes which man has ever committed or endured, may be traced to the assumption of a right in the soil, by certain individuals and classes, to the exclusion of other individuals and classes… The next step which man has ever taken, after having claimed property in land, has been to claim property in man…” (loc. cit., p. 34).

Bray declares that his purpose is:

“…fighting them” (the economists) “upon their own ground, and with their own weapons” (loc. cit., p. 41) (in order to prove that poverty need not be the lot of the workers under every social system). “Before the conclusions arrived at by such a course of proceeding can be overthrown, the economists must unsay or disprove those established truths and principles on which their arguments are founded” (loc. cit., p. 41).

According to the economists the production of wealth requires: 1) labour, 2) accumulation of previous labour, or capital, and 3) exchange.[ww] These are, according to the economists themselves, the universal conditions of production.

“They are applied to society at barge, and, from their nature, cannot exempt any individual or any class from their operation” (loc. cit., p. 42).

“The ban—‘Thou shalt babour’—rests alike on all created beings… Man only can escape this law; and, from its nature, it can be evaded by one man only at the expense of another” (loc. cit., p. 43).

“From the very nature of labour and exchange, strict justice not only requires” <in this context, Bray refers to the economic definitions of the exchange-value of commodities> “that all exchangers should be mutually, but that they should likewise be equally, benefited… If a just system of exchanges were acted upon, the value of all articles would he determined by the entire cost of production; and equal values should always exchange for equal values… the workmen have given the capitalist the labour of a whole year, in exchange for the value of only half a year—and from this […] has arisen the inequality of wealth and power which at present exists around us. It is an inevitable condition of inequality of exchanges—of buying at one price and selling at another—that capitalists shall continue to be capitalists, and working men be working men—the one a class of tyrants and the other a class of slaves—to eternity” (op. cit., pp. 48-49).

“By the present […] system, exchanges are not only not mutually beneficial to all parties, as the political economists have asserted, but it is plain […] that there is, in most transactions between the capitalist and the producer, […] no exchange whatever … what is it that the capitalist, whether he be manufacturer or banded proprietor gives […] for the labour of the working man? The capitalist gives no labour, for he does not work—he gives no capital, for his store of wealth is being perpetually augmented… the capitalist […] cannot […] make an exchange with anything that belongs to himself. The whole transaction, therefore, plainly skews that the capitalists and proprietors do no more than give the working man, for his labour of one week, a part of the wealth which they obtained from him the week before!—which just amounts to giving him nothing for something… The wealth which the capitalist appears to give in exchange for the workmen’s labour was generated neither by the labour nor the riches of the capitalist, but it was originally obtained by the labour of the workman; and it is still daily taken from him, by a fraudulent system of unequal exchanges” (loc. cit., pp. 49-50). “The whole transaction […] between the producer and the capitalist, is a palpable deception, a mere farce” (loc. cit., p. 50).

“…the law which says ‘There shall be accumulation’, is only half fulfilled, and is made to subserve the interests of a particular class, to the detriment of all the rest of the community…” (loc. cit., p. 50).

“Under the present social system, the whole of the working class are dependent upon the capitalist or employer for the means of labour; and where one class, by its position in society, is thus dependent upon another class for the means of labour, it is dependent, likewise, for the means of life; and this is a condition so contrary to the very intention of society—so revolting to reason … that it cannot for one moment be palliated or defended. It confers on man a power which ought to be vested in nothing mortal” (loc. cit., p. 52).

“Our daily experience teaches us, that if we take a slice from a loaf, the slice never grows on again: the loaf is but an accumulation of slices, and the more we eat of it, the less will there remain to be eaten. Such is the ||442| case with the loaf of the working man; but that of the capitalist follows not this rule. His loaf continually increases instead of diminishing: with him, it is cut and come again, for ever. … if exchanges were equal, would the wealth of the present capitalists gradually go from them to the working classes: every shilling that the rich man spent, would leave him a shilling less rich” (loc. cit., pp. 54-55).

Bray also shows in his work that:

“… it is […] impossible that any capitalist can have derived even one thousand pounds sterling from the actual hoarded labour of his working-class progenitors” (loc. cit., p. 55).

It follows from the teachings of the economists themselves that “…there can be no exchanges without accumulations—no accumulations with-out labour” (loc. cit., p. 55).

“…under the present system, every working man gives to an employer at least six days’ labour for an equivalent worth only four or five days’ labour, the gains of the last man are necessarily the losses of the first man” (loc. cit., p. 56).

“Thus, in whatever light” [the genesis of wealth is] “examined—whether as a gift, […] individual accumulation, […] exchange, […] inheritance—there is proof upon proof that there is a flaw in the rich man’s title which takes away at once its very show of justice, and its value” (loc. cit., pp. 56-57).

“… this wealth has all been derived from the bones and sinews of the working classes during successive ages, and it has been taken from them by the fraudulent and slavery-creating system of unequal exchanges” (loc. cit., p. 57).

If “a working man under the present system […] would become wealthy, he […] instead of exchanging his own labour, must become a capitalist, or exchanger of the labour of other people; and thus, by plundering others in the same manner as he was plundered, through the medium of unequal exchanges, he will be enabled to acquire great gains from the small losses of other people” (loc. cit., p. 57).

“The political economists and capitalists have written and printed many books to impress upon the working man the fallacy that ‘the gain of the capitalist is not the boss of the producer’. We are told that Labour cannot move one step without Capital—that Capital is as a shovel to the man who digs—that Capital is just as necessary to production as Labour itself is… this mutual dependency between Capital and Labour has nothing to do with the relative position of the capitalist and the working man; nor does it show that the former should be maintained by the latter… It is the capital, and not the capitalist, that is essential to the operations of the producer; and there is as much difference between the two, as there is between the actual cargo and the bill of lading” (loc. cit., p. 59).

“From the relation which capital and labour bear to each other, it is evident that the more capital or accumulated produce there is in a country, the greater will be the facilities for production, and the less labour will it require to obtain a given result. Thus the people of Great Britain, with the aid of their present vast accumulations of capital—their buildings, machinery, ships, canals and railways—can produce more manufactured wealth in one week, than their ancestors of a thousand years since could have created in half a century. It is not our superior physical powers,[xx] but our capital, which enables us to do this; for, wherever there is a deficiency of capital, production will progress slowly and laboriously, and vice versa. From these considerations, then, it is apparent, that whatever is gained to Capital, is likewise gained to Labour—that every increase of the former tends to diminish the toil of the latter—and that, therefore, every loss to Capital must also be a loss to Labour. This truth, though long since observed by the political economists, has never yet been fairly stated by them” [loc. cit., pp. 59-60].

<In fact, the fellows argue in the following way:

Accumulated products of labour, i.e., products not consumed, lighten labour and make it more productive. As a consequence, the fruits of this lightening and so on must go not to labour itself but to accumulation. Consequently, it is not accumulation which must be the property of labour but labour must be the property of accumulation—[that is, it must be the property 1 of its own products. Consequently, the worker must not accumulate for himself but for someone else, and the accumulation must confront him as capital.

For the economists, the material element of capital is so integrated with its social form as capital—with its antagonistic character as the product of labour dominating labour—that they cannot write a single sentence without contradicting themselves.>

“They have even identified Capital with one class of the community, and Labour with another class—although the two powers have naturally, and should have artificially, no such connection. The economists always attempt to make the prosperity, if not the very existence, of the working man dependent upon the condition of maintaining the capitalist in luxury and idleness. They would not have the working man to eat a meal until he has produced two—one for himself and the other for his master—the batter receiving his portion indirectly, by unequal exchanges” (ibid., p. 60).

“When the workman has produced a thing, it is his no longer—it belongs to the capitalist—it has been conveyed from the one to the other by the unseen magic of unequal exchanges” (loc. cit., p. 61).

“Under the present social system, Capital and Labour—the shovel and the digger—are two separate and antagonistic powers” (loc. cit., p. 60).

||443| “But even if all the land and the machinery and the houses did belong to the capitalists, and the working class were not in being, the former would not thereby be enabled to evade the great condition ‘that there shall be labour’. Their wealth would leave them in the choice only of working or starving. They cannot eat the land and the houses; and the land will not yield sustenance, nor the machinery make clothing, without the application of human labour. Therefore, when the capitalists and proprietors say that the working class must support them, they likewise say, in effect, that the producers belong to them as well as the houses and bands do—that the working man was created only for the rich man’s use!” (op. cit., p. 68).

“… the producer […] receives, in exchange for what he gives to the capitalist—not the labour nor the produce of the labour of the capitalist, but—work! Through the instrumentality of money, the working class are not only compelled to perform the labour which the preservation of existence naturally imposes upon them, but they are likewise saddled with the labour of other classes. It matters not whether the producers now receive gold, or silver, or other commodities from a non-producing class: it all amounts to this—that the working class perform their own labour, and support them-selves, and likewise perform the labour of the capitalist, and maintain him into the bargain! Whatever may be the nominal receipts which the producers receive from the capitalists, their actual receipts are—the transfer of that labour which ought to be rendered by the capita lists” (op. cit., pp. 153-54).

“… we will suppose the population of the United Kingdom […] to be [… ] 25,000,000 of human beings. […] we may […] estimate the entire maintenance of the twenty-five millions of people to be worth,[yy] on the average, at least £15 per head annually. This gives £375,000,000 as the yearly value of the maintenance of the whole people of the United Kingdom. We do not, however, employ ourselves merely in producing articles of subsistence, for our labour creates, likewise, many unconsumable articles. We every year add to our stock of accumulations, or capital, by increasing the number of our houses, ships, implements, machines, roads, and other assistants to further production, beside making good all wear and tear. Thus, although our subsistence may be worth but three hundred and seventy-five millions sterling a year, the total annual value of the wealth created by the people […] will not be loss than five hundred millions sterling” (op. cit., p. 81).

“… we cannot calculate upon having above one-fourth of our population, or about six millions of men—that is, those between the ages of fourteen and fifty—as effective producers. Of this number […] scarcely five millions can be said, under the present arrangements […] to assist in production;” (Bray writes later on that only four millions are directly employed in actual production) “for thousands of able-bodied men […] are compelled to stand idle while the work which they ought to do is being performed by women and children; and hundreds of thousands of men in Ireland can obtain no employment whatever. Thus less than five millions of men, assisted by a few thousands of women and children, have […] to create produce for […] twenty-five millions…” (loc. cit., pp. 81-82).

“… the present number of working men, if unassisted by machinery, could not support themselves and the present number of idlers and unprofitable labourers [… ] The agricultural and manufacturing machinery of every kind which we bring to our aid in the business of productions, has been computed to perform the labour of about one hundred millions of effective men… this machinery—and its application under the present system, which has generated the hundreds of thousands of idlers and livers on profit who now press the working class into the earth” (loc. cit., p. 82).

“The present constitution of society has been fertilised by machinery, and by machinery will it be destroyed… The machinery itself is good—is indispensable; it is the application of it—the circumstance of its being possessed by individuals instead of by the nation—that is bad” (loc. cit., pp. 82-83).

“The five millions of men already enumerated as assisting in production will include all who labour little or much. Some […] do not work five hours a day, while others again toil on fifteen hours;[zz] and when to this is added the time lost by the compulsory idleness of great numbers in times of depression in trade, it will be found that our annual production is created and distributed by less than one-fifth of the community, working, on the average, ten hours a day” (loc. cit., p. 83).

“… we suppose that the wealthy non-producers of every description, with their families, and dependents, amount only to two millions of persons, yet this number alone would cost the working classes 230,000,000 annually, if their maintenance were averaged, bike that of the latter, at £15 per head… therefore,[aaa] upon the most moderate computation their maintenance will cost not less than £50 per head. This gives a total of £100,000,000 as the annual cost of the mere drones of society—the utterly unproductive…” (loc. cit., pp. 83-84).

“… likewise[bbb] the double and quadruple allowance received by the various classes of small proprietors, manufacturers, and tradesmen, in the shape of profit and interest, ||444| Upon the most moderate computation, the share of wealth enjoyed by this extensive portion of the community will amount to not less than £140,000,000 annually, above the average of what is received by an equal number of the best paid of the working class. Thus, along with their government, the two classes of idlers and livers on profit—comprising perhaps one-fourth of the entire population—absorb about £300,000,000 annually, or above one half of the entire wealth produced […] an average boss of above £50 per head to every working man in the empire!—This leaves no more than an average of £11 per head per annum, to be divided amongst the remaining three-fourths of the nation. From calculations made in 1815, it appears that the annual income of the whole people of the United Kingdom amounted to about £430,000,000; of which the working class received £99,742,547, and the rent, pension, and profit class £330,778,825! The whole property of the country was at the same time calculated to be worth nearby three thousand millions of pounds sterling” (loc. cit., pp. 84-85).

Cf. the list of Gregory King etc.

England, 1844. Population: Nobility and gentry—1,181,000. Trades men, farmers, etc.—4,221,000 (combined total—5,402,000). Labourers, paupers, etc.—9,567,000. Banfleld (T.C.), The Organisation of Industry, second ed., London, 1848. |X-444||

[a] In the manuscript “i.e.” instead of “that is to say”.—Ed.

[b] In the manuscript “Consequently, if” instead of “If then”.—Ed.

[c] In the manuscript “But this is” instead of “that it is”.—Ed.

* ||XV-862a| Because surplus-value and surplus labour are identical, a qualitative limit is set to the accumulation of capital, [it is determined by] the total working-day (the period in the 24 hours during which labour-power can be active), the given stage of development of the productive forces and the population, which limits the total number of working-days that can be utilised simultaneously at a given time. If, on the contrary, surplus yield is understood in the abstract form of interest, that is, as the proportion in which capital increases itself by means of a mythical “sleight of hand”, then the limit is purely quantitative and it is absolutely impossible to see why capital does not daily add to itself interest as capital every morning, thus creating interest on interest in infinite progression. |XV-862a||

[d] See Theories of Surplus-Value, Part II, pp. 541-42 and this volume, pp. 114-15.—Ed.

[e] In the manuscript “for”.—Ed.

[f] Instead of “this surplus labour must”, the manuscript has “This surplus labour, that is an even larger amount, must”.—Ed.

[g] Instead of “which is the same thing”, the manuscript has “which comes to the same thing”.—Ed.

[h] The following sentence is Marx’s paraphrase (written in German) of the ideas the author sets forth in the pamphlet.—Ed.

[i] The first part of the sentence up to the words: “are worked” is not a quotation but a paraphrase by Marx (in German).—Ed.

[j] The Source and Remedy of the National Difficulties, deduced from Principles of Political Economy, etc.—Ed.

[k] In the manuscript “The”—Ed.

[l] In the manuscript “The entire war against the French Revolution” instead of “the history of the last thirty years”.—Ed.

[m] The Source and Remedy of the National Difficulties, published anonymously.—Ed.

[n] Ravenstone, Thoughts on the Funding System, and its Effects.—Ed.

[o] Labour Defended against the Claims of Capital; or, the Unproductiveness of Capital Proved, which Hodgskin published anonymously.—Ed.

[p] In the manuscript “Wealth is nothing but disposable time”.—Ed.

[q] Activity.—Ed.

[r] In the manuscript this reads: “The conviction of the worker employed by the cotton spinner… ”—Ed.

[s] In the nascent state.—Ed.

[t] A mode of expression, a figure of speech.—Ed.

[u] In kind, in this context it means: within the framework of a natural economy.—Ed.

[v] This is not a quotation from Chavée but a free summary of some of his ideas.—Ed.

[w] Virtue.—Ed.

[x] To surround with a wall, to fortify, to defend.—Ed.

[y] To be strong, vigorous.—Ed.

[z] Wall.—Ed.

[aa] Rule, govern, control.—Ed.

[bb] In the manuscript “the vast utility of the steam-engine does”.—Ed.

[cc] In the manuscript “the”.—Ed.

[dd] See this volume, pp. 16-17 and 31-32.—Ed.

[ee] In the manuscript “The Author of An Essay on the Application of Capital to Land says”.—Ed.

[ff] Instead of the phrase: “they in reality assert the monstrous proposition” Marx wrote in the manuscript in German: they assert the absurd proposition.—Ed.

[gg] Power—Ed.

[hh] In the manuscript “The capitalist is the oppressive middleman between the different labourers. If he is put out of view…”.—Ed.

[ii] The words up to “rapidly” represent Marx’s own synopsis of Hodgskin’s argument and have been translated here from the German. The rest of the sentence is quoted directly from Hodgskin.—Ed.

[jj] Marx paraphrases this proposition of Hodgskin in German (apart from the words “retail trade” and “quantity”) and his rendering has been translated here.—Ed.

[kk] This part of the quotation is slightly condensed and partly translated into German in the manuscript; rendered in English it reads: “If one considers for example fixed capital, the most favourable position for the idea of capital aiding production, three classes of circumstances are to be distinguished under which [the results of] accumulation of capital are very different.”

1. When it is made and used by the same person. It is obvious [that]”.—Ed.

[ll] In the manuscript “when” instead of “if it be”.—Ed.

[mm] In the manuscript “they” instead of “both may”.—Ed.

[nn] In the manuscript “is”.-Ed.

[oo] In the manuscript “and”.-Ed.

[pp] In the manuscript “wages do not facilitate production, like instruments”.—Ed.

[qq] In the manuscript “consists of promises to pay”.—Ed.

[rr] In the manuscript “The invention and employment of paper-money has revealed that capital is by no means something saved”.—Ed.

[ss] In the manuscript “one could suppose”.—Ed.

[tt] In the manuscript “people”.—Ed.

[uu] In the manuscript “As the population increases.”—Ed.

[vv] In the manuscript “must be”.—Ed.

[ww] Marx here summarises Bray’s ideas and presents them in German.—Ed.

[xx] In the manuscript “forces”.—Ed.

[yy] Instead of “we may estimate the entire maintenance of the 25 millions of people to be worth”, in the manuscript “We assume that their maintenance is”.—Ed.

[zz] In the manuscript the two sentences, which are translated into German, are condensed to read as follows: “Of the five million men who at present assist in production some work only five hours a day, others fifteen.”—Ed.

[aaa] In the manuscript “But”.—Ed.

[bbb] In the manuscript “Add to this”.—Ed.

[Chapter XXII] Ramsay

Notes

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