What is it about Capital, Volume 1, and some of Marx’s other writings that helps us throw light on the capitalist process in an exploited country of the world capitalist system?
Bernard D’Mello, a member of the EPW editorial team, writes:
September 2017 marks 150 years since the first volume of Karl Marx’s Das Kapital was published in Hamburg, Germany. (An English translation of Volume 1 first appeared only in 1887. The first foreign language translation to be published was in Russian in 1872.) The appearance of Das Kapital in September 1867 marked a significant inflection point in the history of political economy and the social sciences because this was the first successful application of the method of materialist dialectics to understanding the process of capitalist development in an exploiting country of the world capitalist system. Marx transformed classical political economy with the application of his method of materialist dialectics to a critique of the thought of that school of economics. There is a theory and a history in Kapital, the one abstract, the other concrete, with inevitable tensions between the two. Marx was acutely aware of this and gave each of them their due, with an alternating emphasis.
Of course, Kapital eventually comprised three volumes, the first of which came out in 1867, with a revised second edition in 1872; Volumes 2 and 3 could only be brought out after Marx’s death, by Friedrich Engels in 1885 and 1894, respectively. At the core of Marx’s analysis of capitalism in Kapital were how it had been unfolding as a system in history—how it arose, how it worked, and where it was likely leading. With his conceptual apparatus of value, surplus value, rate of exploitation (or rate of surplus value), organic composition of capital, rate of profit, relative surplus population (or industrial reserve army of labour), etc, Marx discovered a whole lot of contradictions—historical forces promoting change, alongside systemic ones maintaining equilibrium, and an uneasy tension between them. With this theoretical apparatus, he formulated a labour theory of value to analyse exploitation of workers by the capital-owning/controlling class, finding the origin of surplus value, and the methods used to increase it.
Marx also arrived at a view of the accumulation process entirely different from that of the greatest of the English classical political economists, David Ricardo. Here he laid bare the forces that brought forth economic cycles and crises, a tendency of the rate of profit to fall, and a tendency of the capacity to produce surpassing the capacity to consume. Alongside, Marx also threw light on the process of concentration and centralisation of capital, the latter involving mergers and acquisitions. In Marx’s account of capitalist dynamics, both production, and money and finance, were central elements. And of course, the evolution and growth of what Marx thought of as a revolutionary proletariat. In Marx’s analysis, all these intertwined processes “reach a point where they become incompatible with their capitalist integument,” which bursts “asunder,” and the “knell of capitalist private property sounds. The expropriators are expropriated.”
The development of the proletariat into a revolutionary class and the overthrow of the rule of capital seem, in Marx’s view, to be inevitable. Despite his method of materialist dialectics, Marx seems to have been carried away by a false historical determinism. The style and the imagery of the text and the very grandeur of its prose, its passionate indictment of capital—for instance, “Capital is dead labour that, vampire like, only lives by sucking living labour, and lives the more, the more labour it sucks”—certainly engages its readers, bringing them to realise the need for revolutionary change, but this very intent of the writer carried him away, and led him to overestimate the pace of revolutionary change and underestimate the obstacles to such change.
Kapital, however, is more than “a critique of political economy”; there is also a profound interpenetration of economics and sociology. For instance, Marx’s idea of commodity fetishism can be interpreted thus—in a world of commodities, personal relations become reified as relations between things. And for old-fashioned persons like me, there is the essential truth that wealth originates in the exploitation of human labour and nature. Indeed, Marx’s concern for environmental questions mirrored those of the eco-socialists of our times. He was deeply influenced by some of the attempts during his times to develop what is now called an ecological-systems view, rooted in the concept of the metabolism between society and nature. Not for nothing did he write in the first volume of Kapital about capitalist production “simultaneously undermining the original sources of all wealth—the soil and the worker.” Besides, there is Part VIII in Volume 1 on “The So-Called Primitive Accumulation,” which deals with how capitalism arose. Here Marx deals with the expropriation of peasants in Britain through the Enclosures, and more importantly, the pillage, including ecological denudation of what became the periphery of the world capitalist system, signalling “the rosy dawn of the era of capitalist production.”
Marx did not, of course, complete his systematic exposition of what he considered part of “the system of bourgeois economy”—especially the capitalist state, foreign trade, and the world market, and so he left no theoretical framework of capitalism as a world-system. But, as we have seen, in the part of Volume 1 on “So-Called Primitive Accumulation,” he did deal with the impact of emerging capitalism on what was to become the periphery of the world capitalist system. And in the chapter on machinery and modern industry, he did show how with the competitive advantage bestowed by the use of machinery in modern industry, and with colonial domination, the European states “forcibly rooted out, in their dependent countries, all industry …” Marx was thus aware of the exploitative centre–periphery relationship that came about in capitalism as a world-system.
If one were to take account of the empirical reality of the development of underdevelopment of the periphery with the development of capitalism at the centre of this world-system over the last 150 years, then, in the framework of Kapital, the following aspects would perhaps be germane. The “proletariat” would also include poor peasants who are obliged to cede to “capitalists” not only the profits of their enterprise, the rent on the land they cultivate, and the interest on their accumulated debts, but also a part of their “wages.” The “proletariat” would also include not only small producers formally subsumed to merchant capital but also those who are not, but are nevertheless deprived of the “surplus” they generate because they are subjected to unequal exchange in trade.
Essentially, with a low level of proletarianisation in the strict sense of the term, the huge reserve army of labour relative to the active army of wage labour does not merely circumscribe the wage and other demands of employed regular and casual wage workers, but also moderates the producer prices of small producers in the overcrowded and intensely competitive supply-side of the markets that the latter find themselves in. It is this that enhances the profit-making potential of the world capitalist system as a whole. But the relative immiserisation generated thereby reaches a point where it holds down growth of the relative purchasing power of the masses, thereby weakening consumption and adding to overcapacity, thus lowering expected profits on new investment, and thereby dampening the propensity to invest.
[Also read: Special Issue on Das Kapital, Vol 1-150 Years]