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Tag Archives: Karl Marx
State Socialism and The Communist Manifesto
Posted on October 9, 2021 by irishmarxism
Karl Marx's alternative to capitalism part 46
In the Communist Manifesto Marx states that 'the first step in the workers' revolution is the elevation of the proletariat to the ruling class, the winning of democracy. The proletariat will use its political rule to wrest bit by bit all capital from the bourgeoisie, to centralise all instruments of production in the hands of the state, i.e., of the proletariat organised as ruling class . . . '
There then follows a set of demands that 'will naturally be different depending on the different countries. For the most advanced countries, however the following can be put into effect fairly generally.' There is then a list of ten demands of which the most relevant for our purposes are –
'5 Centralisation of credit in the hands of the state through a national bank with state capital and an exclusive monopoly.'
'6. Centralisation of the whole transportation system in the hands of the state.'
'7. Increase in national factories and instruments of production, reclamation and improvement of land in accordance with a common plan.'
These demands would appear to entail the introduction of socialism through actions of the state – albeit with the vital condition that this is a state in the hands of the workers – with state control of industry etc. under a centralised plan as the objective. This is in obvious contrast to Marx and Engels antipathy to (capitalist) state ownership and control as noted in previous posts; their opposition to a putative necessary role for the state in sponsoring workers cooperatives; and the prominent role they give to cooperatives in the development of the working class, its movement, and its heralding of a new socialist society.
To anticipate the argument to be presented: the Manifesto was written quickly, in particular circumstances, and, more importantly, at an early part of Marx and Engels' political careers, including before their experience of the Paris Commune. However, none of this explains, or rather explains away, these passages since much of what is written in the Manifesto Marx and Engels defended for the rest of their lives.
If we take the opening lines quoted above: 'the first step in the workers' revolution is the elevation of the proletariat to the ruling class, the winning of democracy', it must be said that while control of the state is required to secure the rule of any ruling class, such control does not make a class the rulers of society. Only in relation to the means of production can a class be constituted as the ruling class. Even were the working class to 'win democracy' it would not yet be a ruling class unless this democracy included its ownership and control of society's productive powers.
Of course, Marx goes on to say that 'the proletariat will use its political rule to wrest bit by bit all capital from the bourgeoisie, to centralise all instruments of production in the hands of the state' but again, the state is a separate body of men and women and cannot be considered to be synonymous with the working class. So, if the state has its hands on the means of production it means the working class does not, and this is true even if the workers state is democratic. As noted before, state title to the productive resources of society would only be consistent with effective workers' ownership if it performed the negative function of preventing alienation of particular factories etc from the collective ownership of society and their appropriation as private capital.
Immediately after the ten demands, Marx states that 'when, in the course of development, class distinctions have disappeared and all production is concentrated in the hands of the associated individuals, the public power loses its political character.'
As Marx then says, 'political power in its proper sense is the organised power of one class for the oppression of another.' For the 'public power to lose its political character' the state would therefore have to cease to exist, but how does production leave its hands and come into the hands of the 'associated individuals'?
The state, as instrument of 'oppression' is unsuitable for control of production and certainly for its exercise by the working class, and it is only by the working class becoming the ruling class can the state 'wither away', as it was later put by Lenin. The working class can therefore only be a ruling class through its role in production and can sustain and defend its position, at least initially, only by having a state of its own.
The socialist scholar, Hal Draper, states that the term 'winning the battle of democracy' (in one translation of the Manifesto) was cryptic and reflected Marx's lack of certainty over whether this meant the victory of the democratic bloc existing in much of Europe at the time, that did not seek to go beyond capitalism or bourgeois rule, or outright proletarian rule as might be thought given the context.
The first edition of the Manifesto was in German and at this time only a bourgeois revolution was immediately anticipated in Germany – "the Communists turn their attention chiefly to Germany, because that country is on the eve of a bourgeois revolution . . ." The ten demands can be better understood as the programme of a radical bourgeois revolution that the working class would support in light of its own weakness and inability at that time to achieve its own class rule. This incapacity did not however mean that the working class was ever to cease for a minute to organise to defend and advance its own particular interests.
In the later 1872 German preface to the Manifesto Marx makes the following points:
'However much that state of things may have altered during the last twenty-five years, the general principles laid down in the Manifesto are, on the whole, as correct today as ever. Here and there, some detail might be improved. The practical application of the principles will depend, as the Manifesto itself states, everywhere and at all times, on the historical conditions for the time being existing, and, for that reason, no special stress is laid on the revolutionary measures proposed at the end of Section II [the ten demands].'
'That passage would, in many respects, be very differently worded today. In view of the gigantic strides of Modern Industry since 1848, and of the accompanying improved and extended organisation of the working class, in view of the practical experience gained, first in the February Revolution, and then, still more, in the Paris Commune, where the proletariat for the first time held political power for two whole months, this programme has in some details been antiquated. One thing especially was proved by the Commune, viz., that "the working class cannot simply lay hold of the ready-made state machinery, and wield it for its own purposes."'
The Manifesto speaks of the proletariat using its political rule to wrest bit by bit all capital from the bourgeoisie, to centralise all instruments of production in the hands of the state, i.e., of the proletariat organised as ruling class . . .' It goes on to say that this involves 'measures which seem economically inadequate and untenable but which in the course of operation drive beyond their own limits, and are unavoidable as a means of transforming the whole mode of production.'
These might seem to have some correspondence to Trotsky's approach laid out in the Transitional Programme, but here they relate to measures to be implemented following the already achieved 'political supremacy' of the working class and not the programme that precedes it. In this context it should also be said that a 'transitional' approach that substitutes demands for expropriation by the (capitalist) state in place of workers' expropriation is a very different approach and involves a different transition.
Draper notes that:
'the Manifesto was one of the few writings in which Marx spoke in terms of state ownership of the means of production. He usually left open the question of the forms of social ownership, which might include workers' associations and cooperatives. The emphasis in the Manifesto reflected the emphasis in the movement for which it was written at the time. State ownership (by a workers' state) was, to be sure, one form of social ownership for Marx.'
Draper also endorses the view that the demands were not specifically those of Marx or Engels but already existing and agreed demands of the Communist League, for whom the Manifesto was written. He also notes the extent that some other specific demands did not represent Marx's own views, (in The Adventures of the Communist Manifesto).
These demands accord with other programmatic statements such as The Demands of the Communist Party in Germany, which were set out as the programme to be adopted in what was understood to be a radical democratic revolution, but not yet a working class and socialist one. In the Manifesto Marx employs the argument about their transitional nature in order to cover this (rather wide) gap, but their realisation would not achieve socialism even if it would strengthen the existing position of the working class and its future struggle.
Marx states in the Manifesto that when the proletariat 'has become the ruling class by revolution, and as such has destroyed, by force, the old conditions of production, it destroys, necessarily, with these conditions of production, the conditions of existence of all class antagonism, of classes generally, and thus it destroys, also, its own supremacy as a class.'
Like Engels in Anti-Duhring, the prospectus is of the state dying following working class revolution and the means of production becoming the property of the associated producers, i.e. the working class. Since no capitalist class would now exist, and no other class could have ownership of the means of production, all class distinctions are removed and the division of society into classes disappears.
In this process many questions arise as to sequence, timing and agency and the telescoped summary in the Manifesto can only be properly considered with due regard to the development of Marx's views at that time. It is possible to quote Marx and Engels in favour of state ownership but not possible to make this consistent with other major statements of view; with the consistency of their overall perspective and programme, or their foundational beliefs.
Two years after the publication of the Manifesto Marx, when he still had hopes for an approaching revolution, hoped that the communists could "make the revolution permanent until . . . at least the decisive forces of production are concentrated in the hands of the workers." (Address of the Central Committee to the Communist League)
Back to part 45
Posted in Karl Marx, Marxism, the State	| Tagged Karl Marx, Marxism	| 2 Replies
State support for the workers?
The first premise to the rules of the First International, written by Marx in 1864 as the first clause, was that 'the emancipation of the working classes must be conquered by the working classes themselves . . .'
In 1882 Engels in London wrote to the German socialist August Bebel:
'The development of the proletariat proceeds everywhere amidst internal struggles and France, which is now forming a workers' party for the first time, is no exception. We in Germany have got beyond the first phase of the internal struggle, other phases still lie before us. Unity is quite a good thing so long as it is possible, but there are things which stand higher than unity. And when, like Marx and myself, one has fought harder all one's life long against the alleged Socialists than against anyone else (for we only regarded the bourgeoisie as a class and hardly ever involved ourselves in conflicts with individual bourgeois), one cannot greatly grieve that the inevitable struggle has broken out.'
One such famous internal struggle was against the draft programme of the United Workers' Party of Germany. The Critique of the Gotha Programme is a document based on a letter by Marx written in early May 1875 to the Social Democratic Workers' Party of Germany (SDAP), with whom he and Engels were in close association.
The Critique, published after his death, was among Marx's last major writings and is named after the proposed platform for the new united party to be created at the forthcoming congress, to take place in the town of Gotha. At the congress, the SDAP ("Eisenachers", based in Eisenach) planned to unite with the General German Workers' Association (ADAV), followers of the deceased Ferdinand Lassalle.
The Eisenachers sent the draft programme for the united party to Marx for comment. He found it negatively influenced by Lassalle, whom Marx regarded as an opportunist, and Marx's response offers perhaps his last extended summary on programmatic strategy.
In a letter to Wilhelm Bracke, Marx states that "After the Unity Congress has been held, Engels and I will publish a short statement to the effect that our position is altogether remote from the said programme of principle and that we have nothing to do with it.' Describing it as a 'thoroughly objectionable programme that demoralises the Party', he vowed not to 'give [it] recognition, even by diplomatic silence.'
The document discusses numerous questions but it is particularly useful in presenting Marx's views on strategy before working class conquest of political power, including the two questions at issue in our latest posts – on the cooperative movement and the role of the state.
It should be noted that Marx was not against socialist unity but did not support the abandonment of political principle in order to achieve it:
'If, therefore, it was not possible — and the conditions of the item did not permit it — to go beyond the Eisenach programme, one should simply have concluded an agreement for action against the common enemy. But by drawing up a programme of principles (instead of postponing this until it has been prepared for by a considerable period of common activity) one sets up before the whole world landmarks by which it measures the level of the Party movement.'
Marx prefaced these remarks by saying that 'every step of real movement is more important than a dozen programmes', and he undoubtedly saw the cooperative movement as involving just such steps. Following the experience of the Paris Commune just a few years before he had also learned lessons from the real movement of the working class in relation to the role of the state.
The offending paragraph of the proposed united German Party stated:
'The German Workers' party, in order to pave the way to the solution of the social question, demands the establishment of producers' co-operative societies with state aid under the democratic control of the toiling people. The producers' co-operative societies are to be called into being for industry and agriculture on such a scale that the socialist organization of the total labour will arise from them."
Marx notes sarcastically that:
'Instead of arising from the revolutionary process of transformation of society, the "socialist organisation of the total labour" "arises" from "state aid"; that the state gives to the producers' co-operative societies and which the state, not the workers, "calls into being". It is worthy of Lassalle's imagination that with state loans one can build a new society just as well as a new railway!'
He goes on, quoting the programme's own words:
'Second, "democratic" means in German "Volksherrschaftlich" [by the rule of the people] But what does "control by the rule of the people of the toiling people" mean? And particularly in the case of a toiling people which, through these demands that it puts to the state, expresses its full consciousness that it neither rules nor is ripe for ruling! . . . The chief offense does not lie in having inscribed this specific nostrum in the program, but in taking, in general, a retrograde step from the standpoint of a class movement to that of a sectarian movement.'
The socialist scholar Hal Draper has argued that 'Marx's objection to the "state aid" nostrum was not to "state aid" per se but to its place in the programme.' What it had become in the hands of their ex-leader Lassalle was 'a universal panacea' and substitute for a rounded programme because the programme had no other socialist plank within it. The state-aid plank was already in the existing Eisenachers' programme but only as one of many measures. On its own the demand was acceptable as part of a larger strategy as Engels argued:
'that the universal panacea of state aid should be, if not entirely relinquished, at any rate recognised . . . as a subordinate transitional measure, one among and alongside of many other possible ones.'
But not as the strategy as a whole, which would make the working class dependent on state support: in effect with the same sort of result as today's demands for widespread 'public ownership' and 'nationalisation'; plus much of the approach to state redistribution of income.
Draper turns the issue into an aspect of Marx's support for reforms but not for reformism; a question of what place reforms have in the programme, and not of reforms being assigned a certain all-encompassing role as the be-all and end-all. He also notes that holding up this single point in the programme is sectarian – holding aloft a particular demand that differentiates the Party from the working class movement. An approach that does not seek to marry the understanding of socialists to the real struggles of the working class and its organisations.
Marx goes on to say in his Critique:
'That the workers desire to establish the conditions for co-operative production on a social scale, and first of all on a national scale, in their own country, only means that they are working to revolutionize the present conditions of production, and it has nothing in common with the foundation of co-operative societies with state aid. But as far as the present co-operative societies are concerned, they are of value only insofar as they are the independent creations of the workers and not proteges either of the governments or of the bourgeois.'
So, it is not the case that the Party's support for workers' cooperatives could routinely and always supplement support with calls for state assistance, rather in the way that today nationalisation is often accompanied with the call for 'workers' control'; but that such state support can be acceptable and may not on its own invalidate the workers' efforts. However – 'they are of value only insofar as they are the independent creations of the workers.'
This need for independence of the workers from the state is highlighted in the following section of the Gotha Critique, beginning by him quoting the programme that 'according to [section] II, the German Workers' the party strives for "the free state."
Marx says of this that:
'Freedom consists in converting the state from an organ superimposed upon society into one completely subordinate to it; and today, too, the forms of state are more free or less free to the extent that they restrict the "freedom of the state."
'The German Workers' party—at least if it adopts the program—shows that its socialist ideas are not even skin-deep; in that, instead of treating existing society (and this holds good for any future one) as the basis of the existing state (or of the future state in the case of future society), it treats the state rather as an independent entity that possesses its own intellectual, ethical, and libertarian bases.'
This reminds us of Engels' remark in an earlier post that the state represents society and the conclusion we drew that 'In each case the state represented those classes that owned and controlled the means of production (at least of the social surplus), so that the capitalist state defends the ownership of the means of production of the capitalist class. The analogous role of the workers' state is not to direct and manage its own ownership of the means of production but to defend the ownership by the working class of the means of production.'
For Marx 'the whole programme, for all its democratic clang, is tainted through and through by the Lassallean sect's servile belief in the state . . .'
The Critique of the Gotha Programme, published after his death, was among Marx's last major writings but at the time German socialist Wilhelm Liebknecht, who supported the unity initiative, attempted to censor his criticism. Only in 1891, after threats by Engels, was the Critique published. Much of today's Marxist movement gives every indication that this censorship was, in fact, successful.
Forward to part 46
Posted in Co-operatives, Frederick Engels, Karl Marx, Marxism, the State	| Tagged Karl Marx, Marxism, the State, workers' cooperatives	| 1 Reply
The role of the workers' state
Posted on September 5, 2021 by irishmarxism
In the previous post we noted that state ownership appeared an inevitable progression of the capitalist mode of production and could be read as a tendency to complete its development, with 'the partial recognition of the social character of the productive forces forced upon the capitalists themselves. Taking over of the great institutions for production and communication, first by joint-stock companies, later in by trusts, then by the State. (All quotations from Engels' Socialism Utopian and Scientific)
Such an outcome would not be socialism as some political tendencies might suggest with their programmes for widespread nationalisation: 'the transformation, either into joint-stock companies, or into state ownership, does not do away with the capitalistic nature of the productive forces.'
The state guarantees (including ownership in many cases) of the financial system after the financial crash in 2008 illustrated almost perfectly the growing role of the state in supporting the whole constitution of the existing mode of production. The world-wide assumption of guarantees of employment and business survival during the Covid-19 pandemic has confirmed this. It is unfortunate that rather than highlight this, much of the left has called for even greater state intervention, further sowing illusions in its potentially progressive role.
So, if Engels made it clear that capitalist state ownership is not socialism, a second question was nevertheless raised: is ownership by a workers' state socialist even if ownership by the capitalist state is not?
Engels says: 'Whilst the capitalist mode of production more and more completely transforms the great majority of the population into proletarians, it creates the power which, under penalty of its own destruction, is forced to accomplish this revolution. Whilst it forces on more and more of the transformation of the vast means of production, already socialized, into State property, it shows itself the way to accomplishing this revolution. The proletariat seizes political power and turns the means of production into State property.'
So, it would appear that the seizure of the means of production by the workers' state constitutes the decisive opening of the road to socialism, and some form of state socialism may indeed be the genuine article. (Although the wording here is rather peculiar, for while capitalism more and more transforms the 'vast means of production . . . into state property' the proletariat through its revolution is to turn it 'into state property'–to complete the transformation?)
Except Engels immediately goes on to say this:
'But, in doing this, it abolishes itself as proletariat, abolishes all class distinction and class antagonisms, abolishes also the State as State. Society, thus far, based upon class antagonisms, had need of the State. That is, of an organization of the particular class which was, pro tempore, the exploiting class, an organization for the purpose of preventing any interference from without with the existing conditions of production, and, therefore, especially, for the purpose of forcibly keeping the exploited classes in the condition of oppression corresponding with the given mode of production (slavery, serfdom, wage-labour).'
'The State was the official representative of society as a whole; the gathering of it together into a visible embodiment. But, it was this only in so far as it was the State of that class which itself represented, for the time being, society as a whole: in ancient times, the State of slave-owning citizens; in the Middle Ages, the feudal lords; in our own times, the bourgeoisie.'
'When, at last, it becomes the real representative of the whole of society, it renders itself unnecessary. As soon as there is no longer any social class to be held in subjection; as soon as class rule, and the individual struggle for existence based upon our present anarchy in production, with the collisions and excesses arising from these, are removed, nothing more remains to be repressed, and a special repressive force, a State, is no longer necessary. The first act by virtue of which the State really constitutes itself the representative of the whole of society — the taking possession of the means of production in the name of society — this is, at the same time, its last independent act as a State.'
'State interference in social relations becomes, in one domain after another, superfluous, and then dies out of itself; the government of persons is replaced by the administration of things, and by the conduct of processes of production. The State is not "abolished". It dies out. This gives the measure of the value of the phrase: "a free State", both as to its justifiable use at times by agitators, and as to its ultimate scientific inefficiency; and also of the demands of the so-called anarchists for the abolition of the State out of hand.'
How do we avoid the conclusion that what is being proposed is that upon the socialist political revolution the new workers' state that has gained ownership and control of the means of production through that revolution begins to disappear? Does this mean workers should struggle to enormously expand the power and scope of the state only in order for it to then more or less rapidly shrink and disappear?
To jump straight to a conclusion–the alternative is not to demand state ownership under capitalism, or to seek it under a workers' state, but to struggle for workers' ownership, that is for cooperative production by the working class and this ownership and control to encompass the whole economy.
It is the workers organised as producers that represents 'society as a whole', as required by Engels, and which can 'openly and directly take possession' of the productive forces and manage them, not any sort of state. Even a democratic workers' state is an organised body of repression separate from the working class; any other definition simply mistakes what a state is. Whatever legal and administrative arrangements required to maintain the collective ownership of individual productive forces will either require a minimal role for the state or none at all, e.g. to prevent the alienation of particular productive forces owned by the class as a whole.
Capitalism has so developed the intellectual and social powers of the working class that it can direct the economy without capitalists; provided we do not stupidly restrict definition of the working class in such a way that it excludes its most educated layers, for example because they are normally significantly better off in terms of income than many other workers.
If we read Engels he speaks of 'the State of that class which itself represented, for the time being, society as a whole: in ancient times, the State of slave-owning citizens; in the Middle Ages, the feudal lords; in our own times, the bourgeoisie.'
In each case the state represented those classes that owned and controlled the means of production (at least of the social surplus), so that the capitalist state defends the ownership of the means of production by the capitalist class. The analogous role of the workers' state is not to direct and manage its own ownership of the means of production but to defend the ownership by the working class of the means of production.
Only upon these grounds can the class nature of society be radically changed such that, as Engels argued, the working class abolishes itself and all classes and in so doing abolishes the state. It makes no sense to believe that the state through its ownership of the forces of production will employ its political power to abolish itself, including its direction of society's productive powers.
Socialism is not the granting of the productive powers of society to the working class by any sort of benevolent state. In Engels terms, the workers' state can more and more be the representative of society under socialism to the extent that it disappears, reflecting the disappearance of classes themselves.
The socialist political revolution is the capture of political power by the working class in order to defend, and to extend, its social gains as the rising class in society, with its own ownership and control of society's productive powers central to this. The struggle for workers' cooperatives is the most direct way to make this a reality under capitalism, as both ideological and practical example of the power of the working class to create a new society.
Such a view is consistent with the other expressed views of Marx and Engels, including 'seizing the means of production by society', which we shall review in the next post.
Posted in Frederick Engels, Karl Marx, Marxism, the State	| Tagged Frederick Engels, Karl Marx, Marxism, the State	| 5 Replies
Socialism from the State
Most organisations declaring themselves to be Marxist offer little or no role to the development of worker cooperatives as part of their programme. In one sense this is surprising given the striking declarations of Marx on their importance. In another way it is not so unexpected.
The road to socialism was much debated in the 19th century with a number of currents putting forward a leading role for the state, including in sponsoring cooperatives. Since that time the state has grown enormously, including for reasons that Marx and Engels set out. Its prominence has often been obvious in less developed capitalisms where its role in industrialisation has been more direct from the start of its development.
The misplaced role for the state now current among socialists (nationalisation, income redistribution, state welfare etc.) arises as a reflection in ideology of the massively increased economic and social power of the state within capitalism, and the weight of that ideology transmitted into Marxism through social democracy and Stalinism. All these have been too powerful in their effect on weak Marxist currents. When we appreciate the ideological influence of the Russian revolution, the dominance of the idea of socialism as an expression of state power is unsurprising.
For this reason, it is important in setting out Marx's alternative to capitalism to address not only what he positively advocated but also what he fought against, and one of his recurring battles was against the idea of some of his contemporaries that socialism would issue from the state. Against this he also had to address the views of anarchism, which argued that the state could quickly be abolished.
Given the hold that this 'state socialism' continues to have on a wide variety of socialist and generally 'left' opinion, it is therefore necessary to set out Marx and Engels' views on the role of the state in the creation of socialism. In doing so we will leave aside the actual experience of attempts to implement such a view in the 20th century and will come back to some aspects of these in future posts.
As we have seen, the development of the socialisation of production lays the grounds for collective ownership of the means of production by the working class. This socialisation is expressed through the development of joint stock companies, workers cooperatives and state ownership, following the concentration and centralisation of capital.
Capitalism is therefore a transitional form to socialism but it is necessary to understand the forms of this transition and their unfolding. It is therefore not the case that because state ownership is one of the most developed forms of capitalism, and therefore of transition, it is by this fact also an early form of socialism.
In 'Socialism: Utopian and Scientific' Frederick Engels sums up the historical evolution of capitalism – from medieval society to capitalism – and the contradictions that lead to proletarian revolution:
'Partial recognition of the social character of the productive forces forced upon the capitalists themselves. Taking over of the great institutions for production and communication, first by joint-stock companies, later on by trusts, then by the State. The bourgeoisie demonstrated to be a superfluous class. All its social functions are now performed by salaried employees.'
'Proletarian Revolution — Solution of the contradictions. The proletariat seizes the public power, and by means of this transforms the socialised means of production, slipping from the hands of the bourgeoisie, into public property. By this act, the proletariat frees the means of production from the character of capital they have thus far borne, and gives their socialised character complete freedom to work itself out. Socialised production upon a predetermined plan becomes henceforth possible. The development of production makes the existence of different classes of society thenceforth an anachronism. In proportion as anarchy in social production vanishes, the political authority of the State dies out.'
This formulation leaves open the view that seizure of the mean of production by the state – once itself seized by the working class – removes them as forms of capital, becomes the form of socialisation under the rule of the working class, and initiates their employment as means of satisfying the needs of the vast majority of society. The same proposition appears in Anti-Duhring, from which the short pamphlet is derived.
In an earlier section of 'Socialism: Utopian and Scientific' Engels addresses the Marxist view of the state in the transition to socialism by noting the planning that is involved in the development of Trusts and monopoly:
'. . . with trusts or without, the official representative of capitalist society — the state — will ultimately have to undertake the direction of production. [4] This necessity for conversion into State property is felt first in the great institutions for intercourse and communication — the post office, the telegraphs, the railways.'
In the footnote within this passage Engels states that:
'4. I say "have to". For only when the means of production and distribution have actually outgrown the form of management by joint- stock companies, and when, therefore, the taking them over by the State has become economically inevitable, only then — even if it is the State of today that effects this — is there an economic advance, the attainment of another step preliminary to the taking over of all productive forces by society itself.'
'But of late, since Bismarck went in for State-ownership of industrial establishments, a kind of spurious Socialism has arisen, degenerating, now and again, into something of flunkyism, that without more ado declares all State-ownership, even of the Bismarkian sort, to be socialistic. Certainly, if the taking over by the State of the tobacco industry is socialistic, then Napoleon and Metternich must be numbered among the founders of Socialism.'
'If the Belgian State, for quite ordinary political and financial reasons, itself constructed its chief railway lines; if Bismarck, not under any economic compulsion, took over for the State the chief Prussian lines, simply to be the better able to have them in hand in case of war, to bring up the railway employees as voting cattle for the Government, and especially to create for himself a new source of income independent of parliamentary votes — this was, in no sense, a socialistic measure, directly or indirectly, consciously or unconsciously. Otherwise, the Royal Maritime Company, the Royal porcelain manufacture, and even the regimental tailor of the army would also be socialistic institutions, or even, as was seriously proposed by a sly dog in Frederick William III's reign, the taking over by the State of the brothels.'
This footnote makes clear that Engels did not regard ownership by the capitalist state, often now euphemistically called public ownership, to be any sort of socialism. As he goes on to say in the main body of the text:
'But, the transformation — either into joint-stock companies and trusts, or into State-ownership — does not do away with the capitalistic nature of the productive forces. In the joint-stock companies and trusts, this is obvious. And the modern State, again, is only the organization that bourgeois society takes on in order to support the external conditions of the capitalist mode of production against the encroachments as well of the workers as of individual capitalists.'
'The modern state, no matter what its form, is essentially a capitalist machine — the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers — proletarians. The capitalist relation is not done away with. It is, rather, brought to a head. But, brought to a head, it topples over. State-ownership of the productive forces is not the solution of the conflict, but concealed within it are the technical conditions that form the elements of that solution.'
He goes on to say that 'This solution can only consist in the practical recognition of the social nature of the modern forces of production, and therefore in the harmonising with the socialised character of the means of production. And this can only come about by society openly and directly taking possession of the productive forces which have outgrown all control, except that of society as a whole.'
This 'open and direct' taking into possession cannot be by the state since this is a separate machine apart from the class. Engels follows up the above remarks by stating that the productive forces that 'work in spite of us, in opposition to us, so long they master us . . . when once their nature is understood, they can, in the hands of the producers working together, be transformed from master demons into willing servants.'
The tendency for the state to more and more take over production is therefore posited as the dynamic development of capitalism and not of society ruled by the working class. The state is not the true representative of society, a point made very early in Marx's political development, and is as Engels says: 'essentially a capitalist machine, the state of the capitalists, the ideal personification of the total national capital.'
So, if capitalist state ownership does not mean socialism, what does it mean for 'society openly and directly taking possession of the productive forces', a phrase repeated by Engels a number of times. How is to be done and once done does ownership by the new workers' state mean socialism?
Posted in Karl Marx, Marxism, the State	| Tagged Karl Marx, Marxism, the State	| 5 Replies
Marx against cooperation?
The Inaugural Address to the First International in which Marx expressed support for workers' cooperatives, and the 1859 Preface to 'A Contribution to the Critique of Political Economy', were both political interventions into the working class movement by the 'Marx party', understood as a current of thought in the broader working class movement rather than a separate centralised organisation. The idea that the strong views expressed by Marx in support of cooperatives in the Inaugural Address were a concession to the Owenites and Proudhonists in the International is not credible and requires implausible arguments to dismiss, what are for some, quite uncongenial views. However, as we noted in the previous post, the Address was not the first occasion when Marx expressed support for them, if previously at one remove.
In Volume 11 of Marx and Engels Collected Works the editor has a footnote to two articles nominally written by the English Chartist leader Ernest Jones. In it he says that:
"In 1851 the Chartist weekly Notes to the People published two articles by Ernest Jones, the editor, on co-operation: "A Letter to the Advocates of the Co-operative Principle, and to the Members of Co-operative Societies" (No. 2, May 10, 1851), and "Co-operation. What It Is, and What It Ought to Be" (No. 21, September 20, 1851). They were written at a time when especially close, friendly relations had been established between Marx and Engels on the one hand and Ernest Jones, the Left-wing Chartist leader on the other."
"Marx and Engels constantly helped Jones in his fight for the revival of Chartism on a socialist basis, in his propaganda campaign and his work as publisher and editor of the Chartist papers . . . . On November 4, 1864 Marx wrote to Engels the following: "I happened to come across several numbers of E.Jones Notes to the People (1851, 1852) which, as far as economic articles are concerned, had been written in the main points under my direction and in part even with my close participation. Well! What do I find there? That then we conducted the same polemic—only in a better way—against the co-operative movement, since in its present narrow-minded form it claimed to be the latest word, as ten to twelve years later Lassalle conducted in Germany against Schulze-Delitzsch."
The editor declares that the articles by Jones and the replies by a Christian socialist "show clearly the difference between the viewpoints of the Christian socialist and the proletarian revolutionary. The former saw the aim of the co-operative movement in distracting the workers from the class struggle and called for the collaboration of hostile classes and the reconciliation of their interests."
"Jones, supported by Marx, emphasised that from the viewpoint of the workers' liberation struggle peaceful co-operation had no prospect and that under capitalism workers' co-operative societies could not exist for long; they would not withstand competition on the part of big capital and would go bankrupt, or else they would turn into purely capitalist enterprises deriving profit from exploiting workers. The decisive condition, Jones said, for the workers' co-operative societies to be really of use to the working class was that the latter win political power in order to reorganise the existing system in the interest of the working people."
"Of Jones' many articles on co-operation the two mentioned at the beginning of this note are included in this volume because they most vividly reflect the influence of Marx's views on Jones and show clearly that Marx in fact took part in writing them." (Collected Works Volume 11) p. 57
The spin by the editor would leave the impression that Marx, through Jones, was an opponent of workers' cooperatives and that their existence was merely a prelude to the conquering of political power. Their character, as described by Marx in the Inaugural Address to the First International, demonstrates a quite different view of their significance and prompts a wholly different reading of the articles.
Far from seeking to minimise their significance Jones argues, as does Marx in the Address, that they should be expanded. As to the overall approach to their contemporary advocates Jones says that he writes as "the real friend of co-operation" and that:
"I am not the enemy of co-operation, but its friend—its true friend—I do not oppose co-operation, but wish to rescue it from that course, in which it is digging its own grave."
He notes that the objectives of cooperation are to "destroy profitmongering. . . put an end to competition and . . . to counteract the centralisation of wealth" but that in its present form it fails in all of these:
In the second article he states that
"Therefore, the present plan is not true co-operation; it is essentially hostile to the spread of associated labour; instead of ending profitmongering, it renews it; instead of abolishing competition, it recreates it; instead of abrogating monopoly, it re-establishes it, and is the death-blow to the hopes of labour's emancipation."
In the first he argues that ". . . the co-operative system, as at present practised, carries within it the germs of dissolution, would inflict a renewed evil on the masses of the people, and is essentially destructive of the real principles of co-operation. Instead of abrogating profitmongering, it re-creates it. Instead of counteracting competition, it re-establishes it. Instead of preventing centralisation, it renews it—merely transferring the rôle from one set of actors to another."
"Let us reflect, what are the great canal-companies, joint-stock companies, banking companies, railway companies, trading companies—what are they but co-operative associations in the hands of the rich?"
But, he states, "here again I admit that co-operation on a sound basis is salutary, and may be a powerful adjunct towards both social and political emancipation."
"Then what is the only salutary basis for co-operative industry? A national one. All co-operation should be founded, not on isolated efforts, absorbing, if successful, vast riches to themselves, but on a national union which should distribute the national wealth. To make these associations secure and beneficial, you must make it their interest to assist each other, instead of competing with each other—you must give them unity of action, and identity of interest."
Jones ends the first article by saying that "I have given the difficulties in the way of the co-operative movement—not with a view to discouragement—but that by seeing the dangers, we may learn how to avoid them."
In the second article he explains a bit more what is meant by this:
"People imagine if a few individuals co-operate together to start a trading concern and make as much money as they can, that this means co-operation in the real sense of emancipated and associated labour.
Nothing of the sort! If that were so, every railway, banking, or shipping company would realise the true principles of co-operation.
By co-operation, a very inadequate word, by the way, we mean the abolition of profitmongering and wages-slavery, by the development of independent and associated labour. But this can be established only on the basis of the following principle already laid down in this article.'
No man has a right to take more from society, than the value of that which he confers upon it."
In the first article the watchword is "Nationalise Co-operation"; not in the sense of seeking state ownership, but the extension of cooperatives to national dimensions through seeking their growth and development, not through competition with each other but through cooperation. The further development of economic relations today requires that the corresponding demand would be to call for the extension of cooperation on the international level.
"This is co-operation. It is co-operation, because it establishes a community of interest—the success of each "branch" furthers the success of every other, and of the whole collectively. There can be no conflicting interests—no rivalry—no competition—for the greater the success of each undertaking, the more the stability and permanency of the whole is ensured"
The argument by Jones, and through him by Marx, is not that the conquest of political power is not vital but that cooperation would strengthen the unity and power of the working class and make it better able to resist the attacks of the capitalist class by the state. It does not reduce the importance of the conquest of political power but illustrates the necessity for it to protect and advance the cooperative power of the associated producers, the working class.
Many of today's Marxists understand none of these points, but on the contrary, routinely argue that the state that is the enemy of the growing power of the working class should be hailed as its benefactor, so that instead workers ownership should be discarded for the objective of state ownership! Such is the degeneration of political understanding of much of today's Marxist movement.
Posted in Co-operatives, Karl Marx, Marxism	| Tagged Ernest Jones, Karl Marx, Marxism, workers' cooperatives	| 2 Replies
Marx and the "victory of the political economy of labour"
Nothing illustrates the difference between Marx's view of how the capitalist system could be superseded and replaced by a society under the rule of the working class, and the view of most modern 'Marxists', than the role of workers' cooperatives in their respective social and political programmes.
For Marx, they provide the material conditions upon which workers themselves become the agents of socialisation of production and agents of political change. The revolution that achieves working class emancipation is not just political but social, one in which the relations of production are fundamentally transformed and in which the fetters on the forces of production are broken. Since all this does not arise ex nihilo on the morrow of the revolution, from where else does it arise?
Marx is often criticised for not providing a blueprint of 'what socialism would look like' or 'how it would work', but for him the answer to these questions arises already within capitalism, in fact through its development its beginnings appear before our very eyes. There is no point in speculating on what is not there or on future general arrangements beyond what is already developing.
'We do not anticipate the world with our dogmas but instead attempt to discover the new world through the critique of the old . . . This does not mean that we shall confront the world with new doctrinaire principles and proclaim: Here is the truth, on your knees before it! It means that we shall develop for the world's new principles from the existing principles of the world. We shall not say: Abandon your struggles, they are mere folly; let us provide you with true campaign-slogans. Instead, we shall simply show the world why it is struggling, and consciousness of this is a thing it must acquire whether it wishes or not.' (Marx to Ruge)
So the alternative already grows within capitalism and the working class must become conscious of it:
'They ought to understand that, with all the miseries it imposes upon them, the present system simultaneously engenders the material conditions and the social forms necessary for an economical reconstruction of society. Instead of the conservative motto: "A fair day's wage for a fair day's work!" they ought to inscribe on their banner the revolutionary watchword: "Abolition of the wages system!' (Marx, Value, Price and Profit)
"The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour. They show how a new mode of production naturally grows out of an old one, when the development of the material forces of production and of the corresponding forms of social production have reached a particular stage. Without the factory system arising out of the capitalist mode of production there could have been no co-operative factories. Nor could these have developed without the credit system arising out of the same mode of production."
"The credit system is not only the principal basis for the gradual transformation of capitalist private enterprises into capitalist stock companies, but equally offers the means for the gradual extension of co-operative enterprises on a more or less national scale. The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other"
"After the failure of the Revolution of 1848, all party organizations and party journals of the working classes were, on the Continent, crushed by the iron hand of force. . . All the efforts made at keeping up, of remodelling, the Chartist movement failed signally; the press organs of the working class died one by one of the apathy of the masses, and in point of fact never before seemed the English working class so thoroughly reconciled to a state of political nullity. If, then, there had been no solidarity of action between the British and the continental working classes, there was, at all events, a solidarity of defeat."
"And yet the period passed since the Revolutions of 1848 has not been without its compensating features. We shall here only point to two great factors".
"After a 30 years' struggle, fought with almost admirable perseverance, the English working classes, improving a momentaneous split between the landlords and money lords, succeeded in carrying the Ten Hours' Bill . . . This struggle about the legal restriction of the hours of labour raged the more fiercely since, apart from frightened avarice, it told indeed upon the great contest between the blind rule of the supply and demand laws which form the political economy of the middle class, and social production controlled by social foresight, which forms the political economy of the working class. Hence the Ten Hours' Bill was not only a great practical success; it was the victory of a principle; it was the first time that in broad daylight the political economy of the middle class succumbed to the political economy of the working class."
"But there was in store a still greater victory of the political economy of labour over the political economy of property. We speak of the co-operative movement, especially the co-operative factories raised by the unassisted efforts of a few bold "hands". The value of these great social experiments cannot be overrated. By deed instead of by argument, they have shown that production on a large scale, and in accord with the behests of modern science, may be carried on without the existence of a class of masters employing a class of hands; that to bear fruit, the means of labour need not be monopolized as a means of dominion over, and of extortion against, the labouring man himself; and that, like slave labour, like serf labour, hired labour is but a transitory and inferior form, destined to disappear before associated labour plying its toil with a willing hand, a ready mind, and a joyous heart. In England, the seeds of the co-operative system were sown by Robert Owen; the workingmen's experiments tried on the Continent were, in fact, the practical upshot of the theories, not invented, but loudly proclaimed, in 1848."
"At the same time the experience of the period from 1848 to 1864 has proved beyond doubt that, however, excellent in principle and however useful in practice, co-operative labour, if kept within the narrow circle of the casual efforts of private workmen, will never be able to arrest the growth in geometrical progression of monopoly, to free the masses, nor even to perceptibly lighten the burden of their miseries. . . To save the industrious masses, co-operative labour ought to be developed to national dimensions, and, consequently, to be fostered by national means."
"Yet the lords of the land and the lords of capital will always use their political privileges for the defence and perpetuation of their economic monopolies. So far from promoting, they will continue to lay every possible impediment in the way of the emancipation of labour . . . . To conquer political power has, therefore, become the great duty of the working classes. They seem to have comprehended this, for in England, Germany, Italy, and France, there have taken place simultaneous revivals, and simultaneous efforts are being made at the political organization of the workingmen's party." (Marx, Inaugural Address of the International Workingmen's Association)
Thus, Marx's support for workers' cooperatives is best known for its inclusion in the political foundations of the First International, but this was not the first or only occasion in which he expressed such views, which serves to rebut the idea that his support was somehow forced upon him as a concession to the other disparate forces within the International. And what again is sometimes held up as a disadvantage — that he could not set out his ideas without constraint and in full scientific explanation — is also of some advantage, in that he had to speak to workers in a language that they would most easily understand.
The Inaugural Address to the First International has therefore been partially dismissed on similar grounds to those by which the 1859 Preface to 'A Contribution to the Critique of Political Economy' has been heavily criticised. Such criticism must be rejected for very much the same reasons as we have set out before.
The Preface of 1859 was part of a book that was seen as a publication of the 'Marx party', understood as a current of thought, as a broad political movement, and as a political statement:
Writing to Lassalle on 12 November 1858 he wrote that:
"I have a twofold motive for not allowing this work to be spoiled on medical grounds:
1. It is the product of 15 years of research, i.e. the best years of my life.
2. In it an important view of social relations is scientifically expounded for the first time.
Hence I owe it to the Party that the thing shouldn't be disfigured by the kind of heavy, wooden style proper to a disordered liver."
Writing a few months later to Weydemeyer he stated that "I hope to win a scientific victory for our party."
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The redundancy of the capitalist class
While the socialisation of the capitalist mode of production, associated with the centralisation and concentration of capital, requires unprecedented cooperation in production, alongside the massively increased division of labour, it not only makes the potential for the working class to control such forces manifestly easier, it also progressively demonstrates the increasing potential redundancy of the capitalist class for the direction and management of this production.
The scale and scope of production becomes too big for individual capitalist owners to finance and manage. Marx refers to the "enormous expansion of the scale of production and of enterprises, that was impossible for individual capitals." (All quotations from Capital Vol III).
"Capital, which in itself rests on a social mode of production and presupposes a social concentration of means of production and labour-power, is here directly endowed with the form of social capital (capital of directly associated individuals) as distinct from private capital, and its undertakings assume the form of social undertakings as distinct from private undertakings. It is the abolition of capital as private property within the framework of capitalist production itself."
This means that there is a "transformation of the actually functioning capitalist into a mere manager, administrator of other people's capital, and of the owner of capital into a mere owner, a mere money-capitalist . . . (the salary of the manager is, or should be, simply the wage of a specific type of skilled labour, whose price is regulated in the labour-market like that of any other labour) . . . total profit is henceforth received only in the form of interest, i.e., as mere compensation for owning capital that now is entirely divorced from the function in the actual process of reproduction, just as this function in the person of the manager is divorced from ownership of capital."
"This result of the ultimate development of capitalist production is a necessary transitional phase towards the reconversion of capital into the property of producers, although no longer as the private property of the individual producers, but rather as the property of associated producers, as outright social property. On the other hand, the stock company is a transition toward the conversion of all functions in the reproduction process which still remain linked with capitalist property, into mere functions of associated producers, into social functions."
Marx describes this process as "the abolition of the capitalist mode of production within the capitalist mode of production itself, and hence a self-dissolving contradiction, which prima facie represents a mere phase of transition to a new form of production."
For Marx, this whole process demonstrates that profit is not the reward for the labour and skills of the capitalist but makes it more obvious that it is the result of the appropriation of surplus value derived from the labour of workers, including its managers in so far as these are exploited.
Individual capitalists, indeed the whole capitalist class, commands capital that they no longer actually own, the property of others, so that all justifications of profit as the reward for risk (with other peoples' money) or, even more ridiculously, abstention and saving (through a finance industry notorious for excess consumption!), is exposed as absurd.
Also created is "a new financial aristocracy, a new variety of parasites in the shape of promoters, speculators and simply nominal directors; a whole system of swindling and cheating by means of corporation promotion, stock issuance, and stock speculation. It is private production without the control of private property." "Conceptions which have some meaning on a less developed stage of capitalist production, become quite meaningless here."
Today these phenomena are reflected in the widespread contempt for corporate executive pay and the culture of greed, incompetence and arrogance of bankers and others engaged in the finance industry.
The sacred principle of private ownership of capital and associated caricatures of the heroic self-made entrepreneur less and less reflect any reality in the system, which itself carries out the crime of expropriation that is supposed to damn socialism:
"Success and failure both lead here to a centralisation of capital, and thus to expropriation on the most enormous scale. Expropriation extends here from the direct producers to the smaller and the medium-sized capitalists themselves. It is the point of departure for the capitalist mode of production; its accomplishment is the goal of this production. In the last instance, it aims at the expropriation of the means of production from all individuals."
"With the development of social production the means of production cease to be means of private production and products of private production, and can thereafter be only means of production in the hands of associated producers, i.e., the latter's social property, much as they are their social products. However, this expropriation appears within the capitalist system in a contradictory form, as appropriation of social property by a few; and credit lends the latter more and more the aspect of pure adventurers."
"The credit system accelerates the development of the productive forces and the establishment of the world-market. It is the historical mission of the capitalist system of production to raise these material foundations of the new mode of production to a certain degree of perfection. At the same time credit accelerates the violent eruptions of this contradiction – crises – and thereby the elements of disintegration of the old mode of production."
Over-expansion of credit is often blamed for the periodic crises of overproduction or financial crises, including the construction boom in Ireland when it became the predominant element of the Celtic Tiger, and the 2008 financial crash centred on unsustainable credit and its extension through derivatives. For Marx such events are simply the aggressive manifestation of the essential dynamic of the capitalist mode of production which, as such, has a two-sided result requiring more than simple condemnation.
"The two characteristics immanent in the credit system are, on the one hand, to develop the incentive of capitalist production, enrichment through exploitation of the labour of others, to the purest and most colossal form of gambling and swindling, and to reduce more and more the number of the few who exploit the social wealth; on the other hand, to constitute the form of transition to a new mode of production. It is this ambiguous nature, which endows the principal spokesmen of credit from Law to Isaac Péreire with the pleasant character mixture of swindler and prophet."
All these developments have the potential to provide a transitional form out of capitalism and towards socialism:
"The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour."
"They show how a new mode of production naturally grows out of an old one, when the development of the material forces of production and of the corresponding forms of social production have reached a particular stage."
"Without the factory system arising out of the capitalist mode of production there could have been no co-operative factories. Nor could these have developed without the credit system arising out of the same mode of production. The credit system is not only the principal basis for the gradual transformation of capitalist private enterprises into capitalist stock companies, but equally offers the means for the gradual extension of co-operative enterprises on a more or less national scale."
"The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other."
"Cooperative factories provide the proof that the capitalist has become just as superfluous as a functionary in production as he himself, from his superior vantage point, finds the large landlord."
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The socialisation of capital
Marx notes that a certain accumulation of capital is a precondition for the capitalist mode of production that it then develops accumulation enormously:
"The continual re-transformation of surplus-value into capital now appears in the shape of the increasing magnitude of the capital that enters into the process of production. This in turn is the basis of an extended scale of production, of the methods for raising the productive power of labour that accompany it, and of accelerated production of surplus-value." (Marx Capital Volume 1)
This involves an increasing division of labour inside and outside the workplace; the introduction of machinery and development of large-scale industry; the application of science and knowledge to production; and the increasing transformation of the natural world, all of which can only be the work of many workers combined together.
While many Marxists have prioritised regard to the underdevelopment of imperialist dominated countries and the remaining industrial backwardness of many, they have been loath to also recognise the growth of capitalism which is a necessary feature of its existence. Instead of capitalist development being the grounds for socialism its relative lack of development is often considered to be the warrant for revolution.
This increasing accumulation of capital results in its concentration and centralisation, the former "only another name for reproduction on an extended scale." Centralisation of capital on the other hand allows the greater extension of capitalist accumulation: "a more comprehensive organisation of the collective labour of many people, for a broader development of their material motive forces, i.e. for the progressive transformation of isolated processes of production, carried on by customary methods, into socially combined and scientifically arranged processes of production." (All quotes from Marx, Capital Volume III).
This centralisation accelerates accumulation and allows the creation of forces of production hitherto beyond the capacity of previous numerous smaller capitals, with Marx noting the example of the construction of railways in the 19th century. These in turn add to the productive power of any particular capitalism, raising the standard of productivity required by any newly aspiring capitalist power; requiring it to match the already existing scale, division of labour and technology in order to successfully compete. New capitalist enterprises or countries must aim to at least match this level of development in order to survive, even allowing for temporary protectionist measures it may adopt in then meantime.
The concentration and centralisation of production is but one aspect of the centralisation of capital, with capital in its money form also concentrated and centralised; through its expansion it becomes an enormous means for further development of production and accumulation.
As this accelerated accumulation becomes ever more powerful it heightens the contradictions of capitalism, including the elimination of smaller, or even larger, capitals by competitors, which becomes less and less acceptable to such capitals.
Cartels are formed that predetermine the level of production in order to support the prices and profitability of participating firms, and when even this is not enough socialisation goes further with the creation of monopolies.
"This is the abolition of the capitalist mode of production within the capitalist mode of production itself, and hence a self-abolishing contradiction, which presents itself prima facie as more a point of transition to a new form of production."
Marx notes that expropriation as the starting point of capitalism – through depriving of peasants etc. of their means of production by severing their ties to the land so that they must sell their labour power to capital – becomes the expropriation of other capitals and the creation of monopolies.
The scope and scale of capital no longer allows for the great productive powers created to be the product of individual capitals but the combined power of socialised capital. The financial system becomes one mechanism through which this socialised capital is concentrated, centralised and distributed.
The scale of production – including huge monopolies – and the power of the financial system require the intervention of the state to secure and regulate their workings, while the monopolies and financial system in turn intervene into the state to defend and advance its collective and specific interests.
This socialisation of production comes more and more into contradiction with the appropriation of production by individual capitals and tiny class of capitalists at its apex. The massive planning of huge companies with internal economies larger than many countries stands in contrast to the uncontrolled gyrations of the economy as a whole. The product of socialised labour is inimical to capitalist appropriation of its product, resulting in greater or lesser, but nevertheless permanent, inequalities due to class distinctions.
The socialisation of production continues today, reflected in the growth of the concentration and centralisation of capital in monopolies and growth of the capitalist state. Even after decades of 'neoliberalism' that supposedly relegated the importance of the state, in the US government spending as a percentage of Gross Domestic Product has reached around 40%, having been 34% in 1979 and 7% before World War I.
The expanding role of the state includes vital support for production as noted in the book of economist Mariana Mazzucato:
"Mazzucato lists twelve crucial technologies that make smartphones "smart ": (1) microprocessors; (2) memory chips; (3) solid state hard drives; (4) liquid crystal displays; (5) lithium-based batteries; (6) fast Fourier transform algorithms; (7) the internet; (8) HTTP and HTML protocols; (9) Global Positioning Systems (GPS); (11) touchscreens; and (12) voice recognition. Every last one was supported by the public sector at key stages of development."
The extent of the concentration and centralisation of capital is recorded in a database of 37 million 'economic actors' from 194 countries (the Orbis 2007 marketing database reported on by New Scientist). The socialisation of capital is illustrated by the 13 million ownership links involving ownership of shares etc. between these agents. The study of these identified 43,000 transnational companies in 116 countries, plus an additional 500,000 other corporations and 77,000 individual shareholders to which the transnational corporations have direct or indirect ownership relations. A core of 147 firms controls 40% of the value of the transnational corporations while 737 companies or individuals control 80%.
Such integration is also illustrated by the chance that any two firms in the S&P 1500 US stock market index will have a common owner holding at least 5% per cent of shares in both is 90 per cent, up from around 20 per cent only twenty years ago (People's Republic of Walmart)
In another academic paper (from 2018) the authors find that:
"In the last two decades, over 75% of U.S. industries have experienced an increase in concentration levels. We find that firms in industries with the largest increases in product market concentration have enjoyed higher profit margins and more profitable M&A deals. At the same time, we do not find evidence of a significant increase in operational efficiency, which suggests that market power is becoming an important source of value." The paper thus appears as another example of the view that monopolisation is at variance with the essential operation of capitalism.
This growth of the forces of production has relied upon the development of the labour of the working class, even if its powers have been turned against it; illustrated by notoriously anti-worker companies such as Amazon that are to the fore in developing unheard of levels of planning in their operations.
Nevertheless, the growing concentration and centralisation of capital, with its increased planning and networking of production and distribution, makes the potential for the working class to control such forces manifestly easier. As Engels notes in an addition to Volume III of Capital, when speaking of the chemical industry, "competition has been replaced in England by monopoly, thus preparing in the most pleasing fashion its future expropriation by society as a whole, by the nation."
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Capitalist cooperation and Socialism
Posted on May 25, 2021 by irishmarxism
Karl Marx's alternative to capitalism – part 38
A recent book on how capitalism, through the socialisation of production, is preparing the ground for socialism makes a point made by many – that Marx left no blueprint for a socialist economy.
"Karl Marx and Friedrich Engels may have expertly described the political economy of the capitalist mode of production, but they left few specific descriptions of what their hoped-for replacement would look like."
Not only is it just as well that they did, given the specific way capitalism has developed, but had they done otherwise it would have contradicted their view that socialism would be the creation of the working class, not the elaboration of ideas sucked out of the thumb of great thinkers.
In fact, the authors of the book do not repeat the error of others, who rebuke Marx for not leaving a ready-made solution, because their book is all about how modern capitalism provides the foundation for socialism (as Marx first described in his critique of the political economy of capitalism). As the great man said, the task of socialists is only to make workers conscious of what is going on in front of their eyes in order to move forward.
Their criticism of lacking a blueprint is made more against the Bolsheviks in 1917, but then the Russian empire did not have the preconditions for socialism. The development of the socialisation of production possible under socialism, made possible by prior capitalist development, wasn't achievable because the latter's development was insufficient. Other more advanced capitalist powers could not assist because they did not also succumb to revolution. The fault was not in the heads of the Bolsheviks or the gaps in their programme but the gaps in reality between what existed and what had to be achieved.
The socialisation of production under capitalism that paves the way for socialism can be considered in a number of aspects – the concentration and centralisation of capital and production, created by the increase in cooperative labour arising from the expansion of the division of labour. The first two provide the grounds for the fully cooperative labour of socialism just as the increase in cooperative labour has entailed centralisation and concentration.
As Engels said, quoted in the previous post, "Before capitalistic production . . . the instruments of labour – land, agricultural implements, the workshop, the tool – were the instruments of labour of single individuals, adapted for the use of one worker, and, therefore, of necessity, small, dwarfish, circumscribed. But, for this very reason they belonged, as a rule, to the producer himself. . . . But the bourgeoisie . . . could not transform these puny means of production into mighty productive forces without transforming them, at the same time, from means of production of the individual into social means of production only workable by a collectivity of men."
The point of socialism is for these means of production to become not only the product of the labour of the collective worker but also to come under its ownership and control.
Capitalism, properly speaking, only really begins with this enlarged scope and scale of production. As Marx writes in Capital Volume 1:
"Capitalist production only then really begins, as we have already seen, when each individual capital employs simultaneously a comparatively large number of labourers; when consequently the labour-process is carried on an extensive scale and yields, relatively, large quantities of products. A greater number of labourers working together, at the same time, in one place (or, if you will, in the same field of labour), in order to produce the same sort of commodity under the mastership of one capitalist, constitutes, both historically and logically, the starting-point of capitalist production."
Marx notes that:
"When numerous labourers work together side by side, whether in one and the same process, or in different but connected processes, this form of labour is called co-operation . . . Not only have we here an increase in the productive power of the individual, by means of co-operation, but the creation of a new power, which is intrinsically a collective one."
It is this collective economic power that must become conscious of its role and its interests, which necessarily must entail political consciousness.
Of course, with this development of capitalism, it is capital which combines the many workers, the social labour, that makes cooperation the productive force that it is, requiring greater and greater amounts of capital with person(s) whose sole role it is to wield this capital. The technical division of labour is subsumed within a social division of labour marked by an increasingly hierarchical division of power between owners, Directors, managers and workers, within which there are other numerous lesser gradations of division. Cooperative labour thus presupposes a capitalist class that grows in power as the scale of cooperative labour also grows.
This class performs the necessary tasks of directing, superintending and adjusting the performance of this cooperative labour. This class also imposes the discipline and domination of labour which unavoidably arises, and suppresses the resistance that workers instinctively feel in response to external discipline and control. Capitalist ideology then identifies the necessary role of direction of cooperative labour with the capitalist and its role of domination. It does this even when the individual capitalist owner has been replaced by Directors and senior managers who might however be 'incentivised' by share options etc. and thus see a material basis for their role of enforcing the requirements of capital.
How easily this is done is demonstrated by Marx when he says that "it is not because he is a leader of industry that a man is a capitalist; on the contrary, he is a leader of industry because he is a capitalist."
This ideology does not grant that the cooperative workers might carry out the direction of their labour themselves. Marx quotes the 'philistine' Spectator magazine, unfortunately still with us, saying of workers' cooperatives that:
"They showed that associations of workmen could manage shops, mills, and almost all forms of industry with success, and they immediately improved the condition of the men; but then they did not leave a clear place for masters." As Marx says – 'Quelle horreur!'.
The individual workers are only in the workplace because capital has employed them to be there and directs and controls their actions. Their collective power appears as the power of capital and the capitalist and/or management. While they understand that they do not 'belong' to either they also understand that they only perform their work because they have been hired to achieve both the objective of the company and the means to achieve it, neither if which is theirs. This alienates them from their work and is a barrier to their understanding that their labour, like that of the rest of the working class, is the collective foundation of all production, and this being the case, they should both direct and control it.
Again, Marx notes the confusion created: that the power of cooperative labour created by capitalism is not seen as a particular form of such labour but only as the power of capital and its system. Capitalism is nevertheless necessary to bring this particular power of social labour into the world – "the capitalist mode of production is a historically necessary condition for the transformation of the labour process into a social process . . ."
Of course, cooperation has been a feature of all human society and often comes to the fore in particular circumstances, such as natural disaster, giving the lie to crude propaganda that people are naturally or spontaneously selfish or greedy. Only the capitalist mode of production however raises this cooperation to unprecedented scope and sophistication and does so regardless of the subjective motivations of individual members of each class.
It is capitalism which brings about the socialisation of production through increased division of labour allowing the concentration of capital, the application of machinery and development of large scale industry, requiring the most developed cooperation to make it work.
The ideologues of capitalism constantly assert the virtue of competition in its creation but fail to acknowledge and recognise the associated requirement for cooperation. At best they seek to determine the limits of cooperation to within firms, in order to assert the primacy of competition in relations between them, but which even here is only partially true.
The unacknowledged role of cooperation can often be seen in references to Adam Smith's famous pin factory, which required no new techniques or technology but simply required a single worker to devote herself to one of the eighteen tasks required to make a pin, as opposed to each worker completing all of them. Where previously 200 could be made in one day by ten workers, this specialisation allowed production of 28,000 pins in a day.
No pin was therefore the product of a single worker, so we cannot measure output by adding up the number created by each worker as we would have before. Labour has become a social activity requiring the cooperation of each worker so that every pin is wholly the product of all.
When we consider the incredible division of labour today, in order to create such things as cars, ships and computers, it has extended beyond a single workshop to a division of labour between thousands if not tens of thousands of production sites across the globe. Even 'simple' commodities, that are usually taken for granted in the most advanced countries, are the product of tens of thousands of factories and offices. Water requires treatment works, which requires cement, steel, computers and chemicals etc., which each require their own enormous separate production processes. Electricity requires power stations and wind farms with thousands of separate components and an electricity transmission and distribution system to deliver it.
All these elements involve a massive division of labour both within production units and between them. We can no longer even conceive how any of this could be the product of one worker or even single group of workers.
Such is the achievement of capitalism in creating the collective worker. Its socialisation of production requires the cooperation of millions of workers across the globe, yet rather than unite to advance this cooperation to the benefit of all those involved we have drummed into us that we must compete with each other. Not to develop the best products or techniques, but to crush and kill off competitors and potentially destroy the jobs of others.
As the division of labour has advanced so has the necessity for cooperation and so are the preconditions for socialism more and more established; all driven by capital's own thirst for surplus value and profit. The full potential of such cooperation can only be realised through its conscious extension by all those involved in the process of production, distribution and consumption, and the political arrangements that preside over it. All aspects of it, including competition, then become the conscious and purposeful activity of the collective worker.
Posted in Karl Marx, Marxism	| Tagged Capitalism, Karl Marx, Marxism, productive forces of capitalism, relations of production	| 1 Reply
The preconditions for socialism
Utopian socialism, such as this imagined image of Robert Owen's short lived utopian community of New Harmony, Indiana was based on ideas. Karl Marx's was based on existing reality and its development.
Marx said that "new superior relations of production never replace older ones before the material conditions for their existence have matured within the framework of the old society." (1859 Preface). So what are these material conditions that must have matured?
We have already seen that these involve sufficient development of the forces of production so that society is potentially productive enough to abolish the inequalities upon which class relations rest. Such relations before the development of capitalism resided within and supported productive forces that hitherto could not be held in common, therefore providing the grounds for a class that owned the means of production and a class that did not. In capitalism it is capitalists that own the means of production as private property, which is always the right to exclude others from ownership, and the working class that is so excluded. However, as we have also seen, capitalism provides the grounds to go beyond this division.
Ownership and exclusion in production necessarily entails ownership and exclusion of the products of that production, of consumption. The growth in the mass of profit, distributed as profit of enterprise or as dividends, interest, rent etc. is obviously conditioned by ownership just as salaries and wages are also so conditioned. The means of consumption cannot be equitably distributed because the ownership of the means of production entails ownership of what is produced. Insufficient development of production imposes constraints and restrictions on the distribution of consumption so that common ownership of the means of production is equally not possible.
Such inequalities have developed historically through different forms of class society and utopian schemes to wipe the slate clean and impose a more equal society have been doomed to failure unless the material grounds for such equality can be created. This involves a sufficient level of productivity of labour that everyone can have their consumption needs met, and that these needs can be developed without also developing gross inequalities in their distribution.
So what level is this?
While it is clear that pre-capitalist and early capitalist societies could not provide the grounds for common ownership of production and growing equality of consumption, it is also clear that capitalist development now offers such a prospect. 'Clear', not just because of the level of the productive forces already achieved in a growing number of countries but also because of the waste generated by capitalism and its potential for more rational organisation (and the fact that this more rational organisation is also taking place, albeit also disfigured by its own continuing capitalist irrationality).
It would however be unhistorical to state some absolute level, since needs develop historically as a function of the development of the forces of production which create them. It is therefore the latter development that determines this level.
For Frederick Engels in 'Anti-Dühring' this level had been reached by the late 1870s:
"The possibility of securing for every member of society, by means of socialised production, an existence not only fully sufficient materially, and becoming day by day more full, but an existence guaranteeing to all the free development and exercise of their physical and mental faculties – this possibility is now for the first time here, but it is here."
The appropriation of the means of production is therefore key to the satisfaction of needs and its equitable distribution. Appropriation by society as a whole, by its associated producers – the working class (those who work) – provides the grounds for the appropriation of the fruits of that production.
As Frederick Engels again pointed out in 'Anti-Dühring':
"Before capitalistic production, i.e., in the Middle Ages, the system of petty industry obtained generally, based upon the private property of the labourers in their means of production; {in the country,} the agriculture of the small peasant, freeman or serf; in the towns, the handicrafts. The instruments of labour – land, agricultural implements, the workshop, the tool – were the instruments of labour of single individuals, adapted for the use of one worker, and, therefore, of necessity, small, dwarfish, circumscribed. But, for this very reason they belonged, as a rule, to the producer himself."
"To concentrate these scattered, limited means of production, to enlarge them, to turn them into the powerful levers of production of the present day – this was precisely the historic role of capitalist production and of its upholder, the bourgeoisie. . . But the bourgeoisie . . . could not transform these puny means of production into mighty productive forces without transforming them, at the same time, from means of production of the individual into social means of production only workable by a collectivity of men."
"The spinning-wheel, the hand-loom, the blacksmith's hammer, were replaced by the spinning- machine, the power-loom, the steam-hammer; the individual workshop by the factory implying the co-operation of hundreds and thousands of workmen. In like manner, production itself changed from a series of individual into a series of social acts, and the products from individual to social products. The yarn, the cloth, the metal articles that now came out of the factory were the joint product of many workers, through whose hands they had successively to pass before they were ready. No one person could say of them: "I made that; this is my product."
Capitalism has thus developed the forces of production in such a way that they can be appropriated by society as a whole; in fact it has started this process itself:
"On the one hand, therefore, the capitalistic mode of production stands convicted of its own incapacity to further direct these productive forces. On the other, these productive forces themselves, with increasing energy, press forward to the removal of the existing contradiction, to the abolition of their quality as capital, to the practical recognition of their character as social productive forces."
"This rebellion of the productive forces, as they grow more and more powerful, against their quality as capital, this stronger and stronger command that their social character shall be recognised, forces the capitalist class itself to treat them more and more as social productive forces, so far as this is possible under capitalist conditions. The period of industrial high pressure, with its unbounded inflation of credit, not less than the crash itself, by the collapse of great capitalist establishments, tends to bring about that form of the socialisation of great masses of means of production which we meet with in the different kinds of joint-stock companies."
"Many of these means of production and of communication are, from the outset, so colossal that, like the railways, they exclude all other forms of capitalistic exploitation. At a further stage of evolution this form also becomes insufficient: the official representative of capitalist society – the state – will ultimately have to undertake the direction of production. This necessity for conversion into state property is felt first in the great institutions for intercourse and communication – the post office, the telegraphs, the railways."
"If the crises demonstrate the incapacity of the bourgeoisie for managing any longer modern productive forces, the transformation of the great establishments for production and distribution into joint-stock companies and state property shows how unnecessary the bourgeoisie are for that purpose. All the social functions of the capitalist are now performed by salaried employees. The capitalist has no further social function than that of pocketing dividends, tearing off coupons, and gambling on the Stock Exchange, where the different capitalists despoil one another of their capital. At first the capitalist mode of production forces out the workers. Now it forces out the capitalists, and reduces them, just as it reduced the workers, to the ranks of the surplus population, although not immediately into those of the industrial reserve army."
"But the transformation, either into joint-stock companies, or into state ownership, does not do away with the capitalistic nature of the productive forces."
Of course, legions of socialists are able to see capitalism as wholly reactionary, of being in decline and permanent crisis while failing to recognise that through these crises and renewed periods of accelerated accumulation capitalism continues to play the role of preparing for socialism in this 'positive' fashion.
They sometimes make the further mistake, inconsistent with their first, that state ownership is not only positive in this sense but progressive in the sense of being the germ of socialism that only needs to continue its growth. This is best summed up in demands to nationalise the top monopolies or whatever capitalist enterprise is currently failing.
But as Engels immediately goes on to say in Anti-Dühring:
"The modern state, no matter what its form, is essentially a capitalist machine, the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers – proletarians. The capitalist relation is not done away with. It is rather brought to a head. But, brought to a head, it topples over. State ownership of the productive forces is not the solution of the conflict, but concealed within it are the technical conditions that form the elements of that solution."
So the technical elements of the material conditions for the new superior relations of production have matured within the framework of the old society.
This leads Marx to say that:
"This result of the ultimate development of capitalist production is a necessary transitional phase towards the reconversion of capital into the property of producers, although no longer as the private property of the individual producers, but rather as the property of associated producers, as outright social property" (Capital Vol 3 Chapter 27)
Capitalism is thus transitional to socialism but this is also, like capitalism before it, the creation of human beings, and not just human beings as agents of some disembodied socialisation of capitalism. For Marx, ultimately these material conditions require workers themselves being agents of socialisation of production and agents of political change that guarantees the new relations of production.
Future posts will look at this working class agency but the next posts will look in more detail at the socialisation of production and how it heralds the potential of socialism.
Posted in Frederick Engels, Karl Marx, Marxism	| Tagged Frederick Engels, Karl Marx, Marxism, productive forces of capitalism, relations of production	| 5 Replies