Commentary on Political Economy

Tuesday 26 January 2021



The reason why we are taking this long detour in our theorization of totalitarianism with this examination of Marxist political theory is that we are trying to show how totalitarianism is a tendential development, and indeed the tragic denouement, of the statality of capitalism. It follows that before we can trace this contentious link between the statality of capital and its ultimate catastrophic collapse into totalitarian dictatorship we must enucleate the theoretical nature of this statality of capital. Statality differs from all other determinant and therefore essential properties of capitalism in the sense that it is the one property that tendentially grows into its preponderant characteristic as capitalism develops. Our aim here is to trace the trajectory of capitalist statality from the inception of capitalist enterprise and industry to the advanced development of the society of capital.

For this purpose, we shall begin with its differentia specifica, what distinguishes this mode of production from all others, which is the “exchange” on the part of capitalist “employers” of dead labour – the products of human living labour – with the use value living labour of “employees” or workers. Clearly, such an “exchange” must be the result of coercion by employers on employees because it is absurd to think that human beings would trade or “exchange” freely their living activity with the already-produced products of their own living labour, with their objectified labour. Not only are living labour and dead labour incommensurable entities – one being a living activity and the other its objectified form -, but also they exist in different time dimensions, the one being present or potential or future activity whilst the other represents past or objectified or dead labour. From this viewpoint, it is simply false to say that workers “offer their labour” to the capitalist; the contrary is true: it is the capitalist or “employ-er” who offers labour intended as abstract labour or work to the “employ-ee” or worker: in other words, the “labour” or “work” that is the essence of capitalist production is living concrete activity reduced by the capitalist employer to alienated abstract activity – to politically coerced activity under the command of the capitalist. The German words for employer and employee are more figuratively explicit in this regard: the capitalist is the Arbeit-geber, the work-giver, whereas the worker is the Arbeit-nehmer or work-taker!

Again, the form of political coercion specific to capitalism is that the capitalists command the present living labour of workers by means of an “exchange” with their past or dead or objectified labour. It follows that the profitability of capitalists is dependent entirely on their ability to command future living labour. Profit is surplus value that represents a mortgage – the dead hand of the past over the future – on future living labour. (Keynes had an inkling of this insight when he declared in The General Theory that “money [as a store of value and as credit finance] is a bridge between the present and the future”.) But there is one rider to this definition – one that distinguishes capitalism from the slave mode of production. After all, slavery can also be seen as an “exchange” for the living labour of slaves with their past dead labour. The difference between capitalism and slavery is that the capitalist does not legally own the worker: what defines capitalism is that the living labour of workers “exchanged” for their dead labour is legally free to work or not to work for the capitalist – yes, on condition of starving, perhaps, but if workers starve the capitalist does not make a profit, which means that a political compromise must be reached between workers and capitalists.

The political compromise consists of this: - that in exchange for their living labour being paid with their own past labour – that is, in accepting that this “exchange” is really a political coercion forced on them by the fact that capitalists own the means of production and their ownership is enforced by the monopoly owner of the means of violence, the capitalist State – the workers retain the legal right to withdraw their labour and thereby compel the capitalists to improve their living standards materially by increasing their wages and raise the productivity of living labour. Of course, increasing the productivity of living labour serves merely to reduce the real cost per worker of living labour because the capitalist now needs to employ fewer workers to be able to exchange the present dead labour paid in wages for their future living labour. This would certainly create excess living labour, and therefore unemployment because capitalists could not be expected to raise productivity only to see it absorbed into higher wages – except that the capitalist can deploy the excess dead labour derived from the higher productivity of workers to employ more workers from the reserve army of the unemployed or else from new supplies of living labour from other countries and their populations. This entire process is called “relative exploitation” or “relative surplus value extraction”. Alternatively, where capitalists are not forced by workers to increase productivity through innovation, the only way for them to accumulate more profits or surplus value is simply to employ more workers with the existing means of production or to force existing workers to work longer hours. This is called “absolute exploitation” or “absolute surplus value extraction”.

There obviously comes a time when the entire present and potential  army of workers (reserve army plus new populations) is nearly exhausted and the capitalists cannot find new outlets for profitable investment of their excess output or dead labour. It is at this stage that the overall rate of profit of capital begins to decline, interest rates begin to sink and approach “the zero bound” and unemployment begins to rise without any improvement in the living conditions of the employed labour force. At this stage, capitalists have two choices: one is to accept that a large part of their accumulated capital or “assets” is worthless because it is incapable of being profitably invested – this is called a deflation or, when the term structure of loan finance and credit is considered, debt deflation. The other “solution” is to keep employing workers and capital at present levels by means of collective capitalist or state creation of fiat money, that is to say, by means of the extension of credit through the artificial printing of money that essentially involves, depending on “the transmission mechanism” of money supply, either the transfer of social resources to workers, or else the inflation of the “assets” or excess capital that capitalists already own – which then leads to the growing income and property inequality between the owners of “assets” on one side and the working population and the reserve army of unemployed or proletariat on the other.

It follows from all this that the fundamental, ineluctable and irresolvable antagonism at the core of capitalism is this irreducible political class conflict between living labour, the working class, and dead labour owned by the bourgeoisie. By seeking to bestow upon his critique of political economy and of capitalism the aura of “science”, Marx first and then the rest of Marxism came to obfuscate the political essence of the wage relation and of capitalism itself – that is, the coercive and therefore false “exchange” of dead labour for living activity imposed by capitalists on formally free workers. By insisting on the objective identification of value as a measurable quantity made up of “socially necessary labour time”, Marxism turned the capitalist process of production into a politically-neutral technological process whereby “exploitation” referred merely to “the theft of labour time”, of value understood as “socially necessary labour time”, by capitalists against workers. The Marxist critique turned thereafter into an ethical argument about the distribution of income in capitalism instead of the production process – what is produced, when and how. This blanket identification of Value with Labour opened the door to the “ethical socialism” of social democracy from Bernstein to Kautsky and to the present day. Ever since, the diatribe between the Kommunismus of Marxist-Leninists and the Sozialismus of social democrats has been confined to squabbles over whether socialism would be achieved by violent revolutionary or evolutionary reformist methods, with the further rider that communists insist on the scientific and planned determination of Value in social production whereas socialists deny the possibility of such scientific determination for economic planning thereby placing reliance on “markets” rather than central planning to ensure the co-ordination of economic activity.

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