We're reaching the final areas of Capital, and in my opinion, Part 7 on reproduction can be as much of a slog the beginning of the book. But this is where we wrap things up before finishing off with a shorter, more history oriented section. There are only three chapters to this, but they're dense as hell, so it has a small intro to it that we'll address here; think of it as a mild summary of everything we've read to keep in mind for Part 7. It touches on the three parts of the circulation of production. The first step is taking money to invest in the labor power and the means of production, which the early chapters talked about. Then comes the actual production process, where the variable and constant capital combine to produce values greater than the original capital advanced, aka surplus value. Finally, the commodities enter circulation and are realized in money form. This circuit repeats into continual growth while the workers don't see the true value of their labor power regardless of profit. And if there is no profit, the workers are the first to go. Marx addresses this section assuming there is no interruption in this process in order to scientifically study it properly.
Chapter 23: Simple Reproduction
The biggest takeaway from the intro into this is that all processes of production are inevitably going to become process of their own reproduction, similar to how we talked about the worker reproducing his wage after the necessary labor time, only now on a grander scale. But it isn't only the pieces of capital that are reproduced, but also the material conditions that justify its existence. In a prior chapter, Marx compared how the relationship from worker to owner weren't void in older modes of production, but the conditions themselves are what changed.
This then leads to simple reproduction, which is defined as the capitalist taking some of the surplus value produced to throw back into the reproduction process. If someone owns a pizza shop, and it grows in popularity, the owner might use some of that extra surplus value to invest in another employee to help keep up, and lead to more accumulation. By now, we understand that the worker never gets paid until after his labor power is used, so all wages come from the worker's own labor, which is strictly meant for the reproduction of his labor moving forward. This is hidden, because it appears that the worker has been paid for "all" of his labor, when really, the capitalist wants it to be as little as humanly possible. The worker must spend his wage on other worker-produced commodities in order to survive, and continue labor reproduction.
But what about workers that aren't directly involved in this labor process? Suppose you make your own money some other way, such as the rare case of running your own business by yourself and making enough to live on, or maybe you're a farmer, or something detached from the mass of private property owners; you're still at the mercy of capital. Best hope that you can afford private healthcare, and that the corporate-controlled market doesn't eventually work past your ability. Why does this matter? It's to understand that the entire working class is susceptible to the same pitfalls of those employed by a capitalist. Thus, remaining agricultural workers, or depending on the stage of capitalism, feudal workers, still have the same interests as the working class. Think of the revolutions that occurred in largely agriculturally regions.
Overall, this chapter serves to show that the capitalist state functions to regulate labor in its interests as much as possible, regarding labor power, supply, distribution, and most importantly, reproduction. This relationship of owner and worker is held by suppression of the state and keep it in continuation. Again, I can't recommend reading Lenin enough.
Chapter 24: The Transformation Of Surplus Value Into Capital
For much of this work, we've looked at how surplus value comes from capital, but as the section suggests, we will now look at this equation the other way around. The previous chapter explains why capital rests on continual expansion, needing the reproduction of surplus value to maintain its power. That's not exactly cheap, which is why when businesses can't continue increasing output, they eventually go out (and the owner gets a nice subsidy while the workers are out of income). The more surplus value squeezed out in a year will basically fund grander exploitation the following year, if capital works the way it's intended to. The faster this accumulation happens, the more rapidly exploitation will continue. People not understanding that is why so many believe that inflation is not related to rising profits for owners, but in actuality, that's exactly how capitalism was always meant to function.
So it should go without saying that the more capital the owner gets, the more power he has, as he can buy out smaller, or unsuccessful businesses and over time own more and more of the means of production, and ultimately access to human needs. Think about how Amazon can sell things at such a low price, since they're so big that they can afford it. Once that accumulates, they go and buy out small competitors.
Next, Marx returns to Adam Smith, and his statement on how capitalists will always hire more workers as they make more profit. We now know that this isn't exactly true, especially after the initial start to the process. More workers means needing more raw materials to work with, and eventually, accumulation will allow the owner to invest in machinery to take labor from more workers. Think back to the CNC machine example from before, replacing machinists. The implementation of new technology to lessen the burden is good, until workers are cut and the labor is only for higher profit while fewer people get paid. This leads us to the conclusion that capitalists only care about production for production's sake, not for the well being of people and helping society. This connects to the very beginning of the book, on why capitalists are interested in the exchange value, not the use value. Accumulation of more capital, and more savings leads to billionaires and the rich class controlling virtually everything.
This chapter ends with the use of war in capitalism. A war in another nation not only allows for the exploitation of resources and workers at a potentially cheaper rate, but it lays the groundwork for future investment. The destruction of an area can even enable this very workforce at a cheaper cost. It's also worth mentioning the difference between a population's GDP in a capitalist nation vs. a socialist country. If the U.S. GDP goes up, it's because the owning class is getting richer. If it goes up somewhere like Cuba, it means more needs are being met. This isn't to say that there are no issues that go under the radar, but the ruling class of a socialist nation won't work to only make a few rich. Socialism is interested in use-value, not exchange value. The only reason it may need exchange value is for trading, such as what the USSR was forced to do in the early days, since many western nations sanctioned them and wouldn't accept their money.
Chapter 25: The General Law Of Capitalist Accumulation
And here we reach the densest part of this section, on how this accumulation is based on the ratio between variable capital to constant capital. In other words, this ratio of the two growing (or not) determines the amount of command capital has over the workers.
Let us then talk about constant value composition, which is the growth of both forms of capital at the same rate. If these remain close at all times, the increased demand for labor power will continue, allowing wages to go up for the sake of competition in the labor power market. But the minute this correlation widens, and profits don't get up, capitalists will work to push wages down and remain on top. One might argue that if that's true, a gas station wouldn't offer $17 an hour to fill roles in a time like America's recession in 2021, however people forget that that's still far less than the inflation rate, and is looked at as a concession. In other words, keeping rates lower in comparison with inflation over time allows them to fool workers this way. Regardless, as we keep saying, if the surplus value extraction percentage isn't going up, then the mode of production cannot continue, and it only will by greater exploitation over time.
This brings us to technical composition, which is constant capital growing at a higher rate than variable capital. The means of production then get more investment than the labor power, causing the need for capitalists to increase productivity from fewer workers as a means of competition. Then they can sell commodities at a lower rate than their competitor and still turn the same profit. Thus everyone must either match the new technological investment, or go out of business. Starting to add up yet?
How, then, does a capitalist gain more means of production? A little thing called concentration and centralization. The former is exactly as it sounds; investing in more machines, more buildings, etc. The latter is what we talked about earlier, regarding the bigger guy buying out the littler guys to counter individual capitalists repelling each other. Once a few larger capitalists achieve the concentration step, the door is opened for monopoly as fewer and fewer hands own everything. Now social reproduction is expanded into the hands of even fewer. So how do the few large capitalists accelerate this process? This is where finance capital plays a role, which Marx covers more in the following volumes, as well as Lenin with Imperialism: The Highest Stage Of Capitalism. Joint-stock companies are basically legal monopoly; consider how many brands are owned by bigger brands in America.
But let's talk more about centralization. Isn't that the planning strategy used in socialist examples? Sure, and Marx mentions that even under capitalism it can lead to more rapid production in large-scale examples, such as with the construction of railroads. The difference is the profit motive vs. the need motive, and it then becomes easier to understand why building socialism goes smoother following a developed capitalist state than a feudal, or lower capitalist state. Many would argue even that capitalism is a necessary step regarding separation from a larger empire, or developing industry. The point is, though, that once this step is achieved, it is no longer progressive, and the foundation for socialism should follow, instead of ending with the capitalist mode of production. Transitioning and planning from this stage is far easier. Imagine America, a nation with more resources and riches than any other, distributing what it has based off central planning for needs, not central control for profit.
Next, Marx looks to debunk the myth that poverty arises through workers having too many children. Workers creating technologies that put them out of work, and falling profits are what push wages down and cut people out of work. There's no "law of population," yet capital dictates the workforce as if there is, despite there being enough resources for a growing population. Marx calls this the "reserve army of labor," essentially those imprisoned, homeless, or unemployed to keep those employed in check, with a constant threat of "ending up like them." The "excess" population allows for fewer workers to do more, harder work, at worse wages, a violent tactic that shows how much it would benefit everyone to be involved in work for less time, and still receive what they need.
On the other hand, these "reserve classes" are what Marx refers to as "dangerous" to the bourgeoisie. Since they have less to lose, they're more willing to fight harder against the ruling class, and the ruling class will fight harder to suppress them (think police brutality). Socialist society wouldn't have this "reserve" class, as everyone would be entitled to work for the betterment of society, not profit. Any surplus production is meant for the whole population. But as capital accumulates and reproduces, this population grows due to more being thrown out of work, allowing for capital to form its own enemy. This is known as the Absolute Law, and Marx ends this section by showing how this plays out with pauperism misleading workers.
Preventing workers from being conscious of this is a weapon wielded by the bourgeoisie state and ruling class, often times through gentrification. We see this a lot today; as capital flows into a town or sections of a city, banks and businesses thrive which look great, yet we overlook the way it drives poorer classes into more concentrated areas. This becomes a higher area of crime, and police can easier suppress the poorest "reserve" workers. In other words, capitalism doesn't actually solve housing or the housing crises, it just moves it. If homelessness was more visible to the public and less hidden in smaller quarters, public reaction would allow more room for the working class to fight back and unify. Anti-homeless laws, such as loitering or putting up the center piece on benches would take way more fight from the working class as well.
Conclusion
The biggest takeaway in this part is really centered on how labor plays into its own reproduction for profit, and how workers can actively take part in suppressing their own class without trying. Working class unity is very important, no matter how much the accumulation of capital will try and trick us into working against each other. Looking at the Irish Potato Famine in 1846, one million of the poorest class died, while the capitalist class still profited and did nothing to help it. Racism and national chauvinism further breaks up the working class and pits it against each other, and these are things we as workers must overcome. Without liberation of minorities and other targeted groups, none of us are free.
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