Class and Property in Marx's Economic Thought

Exploring the Basis for Capitalism

Jørgen Sandemose

• Publisher: Routledge
• Year: 2018
• ISBN:
  9781351006965
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

This book presents the capitalist system as a function of the interaction of the three basic classes in the capitalist social formation. Through this, it shows how the corresponding conflicts and clashes of interests between those classes – industrial capitalists, wage labourers and landed proprietors – are unavoidable for understanding contemporary economic structures.

Analysing these economic structures in relation to the forms of property ownership, as well as the typical processes of production connected with them, the author points out how Karl Marx's theory of the capitalist social formation is closely connected with the emergence and existence of a national money market. At the same time, the book places a special emphasis on Marx's theory of ground rent and modern landed property, an aspect misinterpreted by many authors; and through an evaluation of the most important Marxian categories regarding the analysis of the world market and its development, further emphasis is placed on the concept of differences in labour intensity between nations. This evaluation illustrates how the main categories of capital, wage labour and landed property acquire a completely different internal relation in poor countries compared to Western capitalist societies.

Class and Property in Marx's Economic Thought aims at exposing a method for analysing contemporary capitalism through focusing on the basic relations of population groups in the capitalist social formation. It will be of interest to students and researchers within the field of economics, as well as other social sciences.

1 Structure and transitions of capital

1.1 Introductory remarks

We shall concentrate on Marx’s Capital as a whole, with the aim of investigating the structure of that work, in the shape in which it has been left us in Marx’s own edition of Volume I (1867) and Friedrich Engels’ edition of Volumes II and III (1885, 1894). However, as will soon become clear, the main idea is that Marx’s work is also a form of empirical construction, portraying the concrete, but general, shapes and structures of the capitalistic features which dominate Western economy and its world market.

The fact that Marx did not live to work out the final composition of either of the two last volumes of Capital probably accounts for the lack of explicit comments from him on the logical structure of the work in general. While there is no reason to doubt that Engels’ editorial work relating to Marx’s manuscripts was properly and thoroughly done, it goes without saying that he may not have elaborated points concerning the architecture and final structure of the work in the way Marx would have. This chapter tries to identify places in Marx’s texts that may be considered essential for an attempt to reconstruct some of his ideas in this respect. This involves reinterpretations of the texts and also an attempt to reconstruct the content of one analysis that is missing from the manuscripts.

It seems that Capital is structured according to a plan designed by Marx in the years 1861–1866.¹ This plan replaced the one that he originally leaned on when writing the well-known manuscript Grundrisse.² In this plan, as can be concluded from the Grundrisse itself (Marx 1993, 275–279; 1953, 186–190). Marx made intensive use of the concept Übergang, most often translated as transition. What he meant to describe with it were the relations prevailing between the three main categories of his work, as it then was being planned: capital, wage labour and landed property. These were also meant to be the titles of the three first, and basic, books.³

I will try to show that the “transitions” treated there should be looked upon as moments of the very structure that produces the distinction between two “aspects” of exposition – that is, that they were adapted to the later work and integrated into it. If this is correct, it may be taken as strengthening the thesis that Marx’s dropping of the first plan had to do with his real progress concerning the level of scientific analysis. At the same time, this progress was not of the kind that could in any way overthrow the methodological results that Marx must have reached through his work with the Grundrisse – at least not in so far as these had to do with the process of capitalist production.

This view implies that in the finished work from 1867 on Marx managed to retain his original theory of the transitions between the said categories, each of which also represents a social class, and to combine it with new insights, despite the fact that his views on the nature of essential categories like circulation and competition of capital had clearly changed in the meantime.

However, my primary aim in this chapter is to contribute to class analysis of capitalist social formation in general as well as of any specific capitalist society. The fundamental structure of the main classes and their interrelation is a subject of primary importance for such an analysis. This means that the chapter in a certain sense is formed abstractly, depicting the general characteristics of that society.

The rest of this chapter is divided into three sections. In the first, the point of the investigation is sketched as a problem of identifying the subjects (classes, class members) whose consciousness must be presumed to be material in carrying the exposition forward. In the second, Marx’s analysis of the relation between use value and exchange value on the macro level, elaborated during his work on the first plan, is used to demonstrate the existence of two such different subjects in Capital. In the next section as well as in the following one, it is shown that as long as the exposition is tied to a level where prices of capitalistically produced commodities correspond to value magnitudes (i.e. are value-prices, meaning that each commodity is sold according to a rule dependent directly on the labour time expended in its production), the wage form and therewith the specific (and false, i.e. exploited) consciousness of the working class forms the subject in question.

In the next section, it is shown how conditions mature for the new subjective form, the one belonging to the individual capitalist as well as the capitalist class. It is claimed that the transition to this form is effectuated by an immanently necessary passage between simple reproduction and accumulation present in Marx’s texts. To clarify this, it has been necessary to make a thorough analysis of certain aspects of the Marxian “reproduction schemes”. (Details are to be found in the appendices to the chapter.) In the fifth section, conclusions relating to the structure of Capital are presented together with an evaluation of the relevance of that structure for Marx’s overall view of history.

1.2 On the concept of transition

Let us start with a look at the third volume of Capital. Here the content of Volume I, “The Process of Production of Capital”, is melded with the content of Volume II, “The Process of Circulation of Capital”, into (an exposition of) “The Process of Capitalist Production as a Whole”. In Volume III, Marx introduces concepts like “cost price”, “profits”, “rate of profits” – that is, categories which reflect the factual experience of the capitalist. Most important of all, we meet the category “production price”, which takes over the role of “value” (“exchange value”) as the centre of gravity of the expense of labour time at which any commodity is now sold and bought. This is as it should be. For Volume III investigates appearances, so that what is being described and analysed, are relations “in reality (i.e. in the world of phenomena)”, as Marx puts it (1966, 47). The important fact is that we now have to do with a world of appearances, an Erscheinungswelt, as it is called in the German original (1968c, 57). Of course, appearances are thematic also in Volumes I and II. But there they are explained in relation to a background that is not at all present for the consciousness of the capitalist. In Volume III, they have to come into consideration as categories furnishing a completed whole of capitalist experience.

Nevertheless, the opening of the analysis of “The Capitalist Process as a Whole” presents us with an exposition which includes a subjective form that has not been developed with sufficient transparency in the preceding volumes. We should expect a comprehensive work like Capital to tell us why it is necessarily so that the form of analysis seen in Volumes I and II must pass over into an analysis mediated through magnitudes of production prices (Volume III). In Volume I in particular, Marx shows how the common consciousness of bourgeois society is fetishized through the existence of commodity and value production. He shows how the very source of value is hidden from everyday consciousness and has to be found and explored by scientific consciousness. But if that is so, it would also mean that an investigation based on the existence of value-prices should by itself show us the dividing line between the two levels of analysis. It would be only reasonable to suppose that we should meet some point where the exposition, so to speak, is broken up, and where it is shown that the immediate structure of value analysis itself has to be sublated (aufgehoben).

Marx might well be accused of vicious circularity, since his argument is dependent upon the existence of the form of consciousness typical of the capitalist – that is, of the economic “character mask”, the possible conditions for which he is supposed to point out and explain. Such a criticism would naturally be extended to Marx’s construction of the concept of the socially average rate of profits and of the production price.⁴

We should expect this “pointing out”, if it exists at all, to turn up somewhere in the closing of Volume II, since that is what immediately precedes the exposition of phenomena tied to prices of production, i.e. average prices systematically deviating from value magnitudes. Volume II concludes with an analysis of the reproduction of the commodity-form of the total productive capital of a nation or a society (that is, the Marxian “reproduction schemes”). This should be significant for a subsequent investigation of “The Process of Capitalist Production as a Whole”, which, in turn, should reactualize the discussion on the average rate of industrial profits, for it is this rate that results from the sum total of social capital and that transforms commodity values to production prices. That is, it is a function of the totality of the value of labour power, the value created by that power and the value upheld by it.

However, before we set out to look for such a possible “pointing out”, let us make a more general methodological consideration of the problem of “transitions” in Marx’s main work. Hopefully, the remarks above make it sufficiently clear that a kind of “immanent” passage is needed between the two last volumes of Capital. But what about the relation between the first two volumes – in other words, between analysis of production and circulation respectively?

Evidently, we need to look at how Marx de facto rounded off Volume I, for he composed the entirety of this part of the work on his own.

The closing chapter (33) is called “The Modern Theory of Colonisation”. Through a critical exposition of E. G. Wakefield’s theory of colonial land tenure, Marx describes the situation for industrial capitalists when there is no system of private property of land and soil. In that case, capital has no “economic” guarantee that the members of the working class will stay on in production.⁵ On the contrary, they will flee from it, to become settlers and free farmers.⁶

The reason for rounding off Volume I in this way is to be found in Marx’s original plan from 1857–1858, in spite of its important differences from the second. Here he points to how capital evolves into a social totality through subsuming other social expressions under itself. He calls this a system which is organic in nature but points out how it will lose its organic particularities when confronting new territory outside itself. Its representatives – the capitalists – then discover that the landed foundation of their system, modern landownership, where capitalization of ground rent makes the soil an expensive resource, has disappeared. Workers therefore have the possibility of fleeing from capitalist coercion, a possibility the British government sought to block through adopting Wakefield’s legal proposals, e.g. in Australia (Marx 1993, 278; 1953, 187). Such a process Marx takes to be a “transition” from capital to landed property, and when it is realized primarily by an upward trend in the price of soil, this is because the price takes the form of capitalized rent and consequently will rise as the interest rate and the rate of the ground rent tend to fall pari passu with the general rate of profits.⁷ That is, the accumulation of capital itself does not only effect an expropriation of immediate producers from the soil (landed property): it also guarantees a long-term high price of land, thereby constructing a permanent obstacle for proletarians who might wish to return to the soil establishing themselves as farmers.⁸

Marx wants to make this important point in the first volume of Capital. However, since chapters 22–33, relating to simple and extended reproduction, analyse accumulation in abstraction from phenomena of circulation, he cannot make the argument concerning the price of soil in concreto (the categories of the rate of profit and ground rent are missing). Therefore, for the time being, he is satisfied with showing how capital in the colonies, where it does not dominate society and consequently cannot regulate the price of soil in an economic way, strives to introduce a high price of land abruptly and politically. The main point is that capitalist production cannot be taken to represent a totality before one has also shown the necessary and prior exclusion of immediate producers from landed property.⁹

However preliminarily, it can safely be said at this point that the composition of the first volume of Capital indicates that Marx was conscious of the fact that the immediate process of production must be exposed as a kind of circuit, where capital in the last instance functions as a self-reproducing totality, or, as it shines through his draft plan of 1857–1858, generates wage labour and therefore its own basis when it produces ground rent.¹⁰

Evidently, to regard capital as a self-producing entity means regarding it as a subject. Since a subject necessarily is an individual of some sort, capital as a subject has to be seen as the capitalist, a human being carrying the character mask of capital. Indeed, the fact that the economic categories take the form of individual subjectivity is inherent in the Marxian concept of “transition”. Actually, the preliminary draft in the Grundrisse shows us that Marx, after analysing the abstract world of appearances in capitalist production, would have brought the exposition of the category of “capital” to a close with a treatment of “the capitalist”,¹¹ which was meant to lead to the analysis of “landed property”. Similarly, a reading of the main draft shows that modern landed property is not introduced before it is possible to show that capital is something that “produces itself”. The implication is that the “transition” from capital to landed property, or the “action” of capital on this property form, should be exposed as conscious action initiated by members of the capitalist class – which includes the possibility of bourgeois nationalization of land (Marx 1993, 279; 1953, 190). In a parallel way, Marx stresses that the pressure of capital on landed property leads the landowner to take independent, class-conscious action against workers (Marx 1993, 277; 1953, 187). Also, this “action” of capital is to be understood as a negation of capital’s own presuppositions and consequently as its negation of itself. Marx goes on to say that this self-negation is nothing other than “wage labour”, which implies that subjects have a conscious wish for independence (Marx 1993, 279; 1953, 190). It is in this way of absolute negativity and conceptual self-negation that capital posits and manifests itself as the centre of a system which, through and through, gets its positive existence from social contradictions and exploitation of labour.

The Marxian concept of “transition” in the Grundrisse draft plan can then be characterized as follows: it indicates general, basic and typical forms of confrontation between main (“categorical”) economic interests, viewed as objective social phenomena of which the participating subjects are conscious, at least in the sense that, through those phenomena, they identify themselves as members of distinct classes. As such, a “transition” is a regular form of interaction between classes in the capitalist social formation, superdetermined, as Marx points out, by “capital”, which operates as an active medius terminus between the other two main categories. The result, then, is a “syllogism”, where everything that is is created, “everything posited is thus also a presupposition”, something which “is the case with every organic system” (Marx 1993, 278; 1953, 189). The closing of the first volume of ...

Table of contents

• Cover
• Half-title Page
• Title Page
• Copyright
• Contents
• Acknowledgements
• Introduction
• 1 Structure and transitions of capital
• 2 Historical and conceptual transition
• Prelude to Chapters 3 and 4
• 3 Karl Marx’s theory of ground rent – historical elements in economic interplay
• 4 Karl Marx’s theory of ground rent – historical elements in economic interplay
• 5 Modes of production on the world market
• Bibliography
• Index