This is the eighth set of notes for a reading group on Marx’s Capital, and includes a Volume I refresher for further reading of Volume II. There are links to earlier posts and texts that may be useful.
Figure 1 depicts the production of relative surplus value and its expansion required by capital. This process—initially theorized by Marx—has been elaborated most fully by Moishe Postone in his book, Time, Labor, and Social Domination (1993). Postone explicates a dialectic of labor and time, whereby the social labor hour and base level of productivity are moved forward in time, giving rise to a particular “treadmill” dynamic, which we refer to as the treadmill of production of value. Our use of the “treadmill” metaphor is also an intention allusion to the well-known “treadmill of production” (ToP) concept advanced by the American environmental sociologist Allan Schnaiberg. However, Schnaiberg focuses solely on the production of wealth, which he specifies in relation to the environmental impact of increasing use-value output. Our metaphor of the ToP of value, on the other hand, emphasizes the temporal dimension of Marx’s concept of capital as self-expanding value (more on this below), which, in turn, redirects focus toward the growing contradiction between wealth (measured in terms of the quantity and quality of products produced) and value (whose magnitude is a function of the expenditure of abstract labor time). logosjournal.com/...
A full online copy of Marx's Capital Volume 1 can be found here: https://www.marxists.org/archive/marx...
As with most of Marx’s work the dynamics of capitalism and the interrelations of political economy. The development of modern manufacturing and divisions of labor still emphasize the relations among labor processes, and their larger relation to the formation of capital into circuits.
Section 1. The Development of Machinery
Outline of Marx's Discussion
Mill: machines have not lightened toil
Marx: machines are the means for producing relative surplus value
Rise of machinery = conversion of tool into machines
Machine:
Complex system of machinery
- = complex tool
= tool driven by natural force
= motor mechanism + transmitting mechanism + tool or working machine
= tools of man have become implements of a mechanism, multiplied
= a mechanism that performs with its tools the same operations as the worker formerly did with similar tools, whether the motive power is derived from man or from another machine
= soon becomes one element in a complex system of machinery
- = simple co-operation of similar machines
= "a connected series of graduate processes carried out by a chain of mutually complementary machines of various kinds"
= "the co-operation by division of labor which is peculiar to manufacture, but now it appears as a combination of machines with specific functions"
= fixed proportions established by their capacities, numbers, speed
= "collective working machine" = "articulated system"
= "constitutes itself a vast automaton"
= automatic system of machinery when the machines "elaborate the raw material, without man's help, and needs only supplementary assistance from the worker"
= "a mechanical monster"
= development in one sector led to development in connected spheres
= implied need for large scale industry to produce machines, i.e., for machines to be built by machines
= replacement of the worker-subject by an "objective organization"
= organization of machinery technically requires co-operation of labor
Commentary
One of the basic themes of this chapter is set out in the very first paragraph where Marx quotes John Stuart Mill to the effect that machines have not "lightened the day's toil of any human being." Marx's response, of course, is that in capitalism machinery is not introduced to lighten toil but to increase relative surplus value. In this way he introduces an argument which will frequently appear in the chapter: the paradox of capitalism that the very machinery which reduces the effort necessary to produce a given product results in more work rather than less. The various ways in which machinery causes an increase in labor will be explored at different points in the text.
What his exposition of the nature of machines primarily deals with is the way in which machines accomplish the same tasks as those carried out by workers. They substitute both mechanical contrivances for the various gesture and operations of the workers and motor power for human energy. He traces the development of machines from relatively simple substitutes for particular operations to complex systems of machinery driven by non-human energy sources. But the story is always the same: machines accomplish that transformation of non-human nature that he identified in Chapter 7 as the nature of human work. Thus particular machines replace particular workers and systems of machines replace large numbers of co-operating workers. In the place of the co-operation of humans, we have the co-operation of machines. In this process some humans are rendered redundant and expelled from production and others are reduced to being mere tenders of machines.
This displacement accomplishes what is for Marx a fundamental change in the work process, one which had already begun in manufacturing but which is completed in modern industry. That change is the replacement of the central role of the worker in commanding the work process by the machine. From being the central subject who works, the worker is demoted to being one more cog in the system of machines.
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Outline of Marx’s Analysis
– in capitalism, social labor produces surplus-value
– early on: formal subsumption of labor produces absolute surplus-value by extending the working day
– later: real subsumption of labor produces relative surplus-value by reducing necessary labor
– but the means for reducing necessary labor also can increase absolute surplus-value – amount of potential surplus labor – Ricardo: saw labor productivity as source of profit
– Mill: affirms source of profits in productivity of labor against mercantilist focus on exchange
– by making the working day longer
– determined by natural conditions of labor – determined by requirements of life
- – need to master nature leads to development of social division of labor
- – where needs are few, a great deal of surplus labor can be imposed
Commentary
In this, the first of the three chapters that take us from analyses in terms of value, to those of the monetary form of the value of labor-power, Marx reminds us of the distinction between absolute and relative surplus-value, of how they are produced and of the relationship between the two. Absolute surplus-value emerges early when capitalists only command or subsume the labor of others formally, that is to say, without taking over and transforming tools and how they are used. Under those circumstances, their only available strategy for increasing the extraction of surplus-value involves getting people to work longer. Because workers control their tools and the rhythm of their work, capitalists have little leverage to extract more surplus-value via the intensification of labor. Relative surplus-value emerges as capitalists do obtain that leverage, by gaining control over tools and organizing them in factories that facilitate oversight and control. Protected by new property laws, they reshape both tools and their use to raise productivity and increase surplus-value—both by reducing the labor time necessary to produce each unit and by increasing the intensity of labor.
Given the increasing centrality of productivity, he also reminds us of how the conditions and meaning of productive labor depends upon the context. At the level of the individual, a productive worker is simply one who produces some product directly, using mind, hands and tools to transform raw materials. That was the generic concept he set out in the first section of Chapter 7. But as human society developed most labor became social, such that individuals came to collaborate in the production of ever more things and in so doing formed a collective worker with a division of labor—that he analyzed in some detail in Chapter 14. With the rise of various kinds of class society, including capitalism, antagonistic relationships develop as some are able to impose surplus work on others and appropriate the resulting surplus product. Within capitalism that surplus product takes the form of surplus-value, so that from the point of view of the appropriating capitalists the only productive workers, i.e., the only workers whose labor makes it possible to impose more work, are those who produce surplus-value, i.e., surplus labor whose products can be used to impose more work in the future. As a result, there is a clear distinction between the vernacular, everyday sense of being productive, i.e., being able to produce something, and the only kind of productivity that matters to capitalists. This is consistent with the emphasis we saw in Chapter 1 between use-value and exchange-value/value. Use-values and the ease with which we can obtain them preoccupy those of us who work; the exchange-value of the surplus production preoccupies those who put us to work.
In illustrating the capitalist case, Marx draws a parallel between those industries that produce things and those that produce services.
. . . a schoolmaster is a productive worker when, in addition to belaboring the heads of his pupils, he works himself into the ground to enrich the owner of the school. That the latter has laid out his capital in a teaching factory, instead of a sausage factory, makes no difference to the relation.
Given that such “productivity” involves exploitation, he adds that, “To be a productive worker is therefore not a piece of luck, but a misfortune.” (1)
Marx then goes on to remind us of the connections that he demonstrated in Chapter 15 between absolute and relative surplus-value. Namely, how the methods used to produce relative surplus-value, i.e., introducing new machines and new technology, also made possible the prolongation of the working day and the intensification of work, both of which added surplus-alue by extracting more work from those subject to the new methods. What he does not remind us of here, is how the shift to relative surplus-value strategies was the result of the success of workers’ struggles to shorten the working day and by so doing undermine absolute surplus-value. (2) Nor does he reiterate his previous analysis of how new machines are designed and new technologies are chosen with the objective of undermining those struggles through the reorganization of the labor process. (3)
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Circulation time stands in opposition to Production Time. As Marx puts it, from the perspective of circulation, production appears, as a hold up, but from the perspective of production, it is circulation that appears as an interruption. The concept of circulation and circulating capital caused great confusion for Adam Smith, Ricardo and others, that Marx clears up.
The circulation period consists of all that time when capital is not engaged in production. Even during that part of the production period when labour is not being expended, capital is still engaged in production, because it is tied up in the production process. The rate of turnover, and the annual rate of profit are calculated on that basis. But, before the production process can even begin, productive-capital in the form of buildings, machines, raw material and labour-power must first be assembled. Money-capital must be advanced for its purchase, and there may be a period of time between this money-capital being advanced, and the actual productive-capital being delivered available to take part in the production process. The further away sources of supply of those inputs, the less efficient modes of transport, the longer it will take for inputs to be delivered, and so the longer this period of circulation time will be.
[...]
But, neither money-capital nor commodity-capital participate in the production process. They stand in opposition to it, in the overall circuit of industrial capital. Neither money-capital, nor commodity-capital can constitute fixed or circulating capital. They represent only capital that is itself in circulation. The period of that circulation constitutes the circulation time of the capital. The combination of the production time, and the circulation time, of industrial capital, is its total turnover time. The number of times this capital turns over during the year is its rate of turnover. boffyblog.blogspot.com/…
Marx here summarises where we are in our analysis. ‘The immediate production process of capital is the process of labour and valorisation.’2 The immediate process of production, the P in M–C ... P ... C′ –M′, was the object of analysis of volume 1: ‘the result of this process [...] [is] the commodity product, and its determining motive the production of surplus-value.’3The process of reproduction of capital also involves the process of circulation of capital, or, more precisely, the place of this circulation in the reproduction of capital.4 At the same time, we have to take account of the fact that each individual capital forms a fraction of the total social capital. This process, of the constant repetition of the cycle of capital, of its perpetual re-emergence as productive capital, is conditioned by its transformations in its cyclical movement; at the same time, the constant repetition of the production process is the condition for transformation of capital in the sphere of circulation.5 ‘The movement of the social capital is made up of the totality of movements of these autonomous fractions, the turnovers of the individual capitals.’6• productive consumption (‘the immediate process of production’)The overall process comprises:• the changes of form which mediate this (materially manifested as exchange)Insofar as these exchanges also comprise the conversion of variable capital into labour-power, the sale of commodities for the individual consumption of the workers, and the circulation of surplus-value – and therefore the individual consumption of the capitalist – the totality of the cycle of the individual capitals comprises not just the circulation of capital but also commodity circulation in general. This last – the general circulation of commodities – consists fundamentally in (1) the cycle of capital and (2) the cycle of those commodities that go into individual consumption.
• In volume 1 the process of production was analysed as an isolated event (the production of surplus-value) and a process of reproduction (the production of capital). Circulation, other than involved in the buying and selling of labour-power, was just assumed.
• In part 1 of this volume we considered the forms of the cycle of capital
• In part 2 we considered this cycle as a periodic one, and the implications of this periodicity.
• Now – since ‘the circuits [cycles] of individual capitals [...] presuppose one another’7 – we consider the movement of the total social capital.
2 The Role of Money Capital (Marx notes here8‘In connection with the turnover of the individual capital, we saw that money capital displays two aspects.’. that this matter is necessary to take account of but that it is tangential to the argument at this point.)9I The productive capacity of a given quantity of money capital is determined by factors other than the magnitude of its value10
Commodity production presupposes commodity circulation; commodity circulation presupposes ‘the representation of commodities in money’:11 ‘the duplication of commodities into commodities and money is a law of the emergence of the product as a commodity.’12 Capitalist commodity production presupposes capital in money form, as both ‘prime mover’ and ‘permanent driving force’.13 This is as true for social capital as for individual capitals. But: the absolute scale of production of capitalist production is not determined [within limits] by the volume of money capital in operation. Given the rate of payment of labour-power, more or less severe exploitation, intensively and extensively, of this can occur. If an increase in the amount of money capital (i.e. a rise in wages) coincides with greater exploitation, the former does not necessarily rise in proportion to the latter.
2 The productive use of natural materials (soil, sea, etc., which do not form a part of capital’s value) may be more or less severely exploitative with a given amount of labour-power, hence without an increase in money capital advanced.
3 In the case of means of labour, prolonging their daily use or raising the intensity of their application increases the velocity of turnover of fixed capital; but, allowing for the fact that the elements of its reproduction are supplied more quickly, also increasing the quantity of fixed capital deployed.
4 The incorporation, which depends on scientific advances, of natural forces as productive agents costs the capitalist nothing.
5 This last point also applies to ‘the social combination of labour-power in the production process and to the accumulated skills of the individual worker.’14• An increase in the productivity of labour in itself increases the quantity of products, but not their value, excepting that more constant capital (of the same value) may be produced for the same labour, which can form the basis for an increase in the accumulation of capital.• If the social organisation of labour heightens its social productivity, increasing the scale of production and hence the amount of money capital necessary to be advanced, this last can be met by the centralisation of capital,15
6 without an absolute growth in its volume. A reduction in the turnover period allows the same productive capital to be set in motion with less money capital (or more productive capital with the same money capital).
Conclusion: What all this indicates is that capital advanced – in form a given sum of money – contains productive powers whose limits are not just given by its value. ‘Once the prices of the elements of production `...] are given,the size of the money capital required to buy a certain quantity of these elements [...] is [...] determined. [...]However, the scale on which this capital operates to form values [...] is elastic [...]
{...]
Insofar as the necessity of money capital is determined by the length of the working period, two conditioning factors exist.
That money capital is the necessary form in which capital begins its process is a product of capitalist production and commodity production in general. This remains true independently of the form taken by money – metallic money, credit money, tokens of value, etc.2
The quantity of money advanced depends on the fact that elements of production are withdrawn from society before useful products that can be converted into money are returned. This is unaffected by either the form of money or the form of production itself.
"Tableau Économique" (eine schematische Darstellung der Volkswirtschaft) des französischen Ökonomen Francois Quesnay (1694-1774) Date1759
The Tableau économique (French pronunciation: [tablo ekɔnɔmik]) or Economic Table is an economic model first described by French economist François Quesnay in 1758, which laid the foundation of the Physiocratic school of economics.[1]
Quesnay believed that trade and industry were not sources of wealth, and instead in his 1758 manuscript Tableau économique (Economic Table) argued that agricultural surpluses, by flowing through the economy in the form of rent, wages, and purchases were the real economic movers.
The model Quesnay created consisted of three economic movers. The "Proprietary" class consisted of only landowners. The "Productive" class consisted of all agricultural laborers. The "Sterile" class is made up of artisans and merchants. The flow of production and/or cash between the three classes started with the Proprietary class because they own the land and they buy from both of the other classes.
Figure 1 Production Flow Diagram for Quesnay's Tableau (4)
The Tableau shows the reason why the Physiocrats disagreed with Cantillon about exporting food. The economy produces a surplus of food, and neither the farmer nor the artisan can afford to consume more than a subsistence level of food. The landlord is assumed to be consuming at a level of satiation; therefore, he cannot consume any more. Since food cannot be stored easily, it is necessary to sell it to someone who can use it. This is where the merchant provides value.
The tableau économique is credited as the "first precise formulation" of interdependent systems in economics and the origin of the theory of the multiplier in economics.[5] An analogous table is used in the theory of money creation under fractional-reserve banking by relending of deposits, leading to the money multiplier.
The wage-fund doctrine was derived from the tableau, then later rejected.
Karl Marx used Quesnay's Tableau as a basis for his theory of circulation in Capital volume 2.
en.wikipedia.org/...économique
I Purpose
Despite the title of the chapter, its contents almost exclusively refer to what Marx called ‘[Adam] Smith’s dogma’,2 that is, the widely held classical political economic view that that the price of commodities, and hence that of the total social product, is entirely ‘resolved’ into ‘revenue’, i.e. into wages, profit and rent (a resolution which excludes constant capital).3
As Marx wrote to Engels in 1863 (when he was working on a draft of material that was to form apart of volume 2): You know that according to Adam Smith, the ‘natural price’ or ‘necessary price’ is composed of wages, profit(interest), rent – and is thus entirely resolved into revenue. [...]. Nearly all economists have accepted this from Smith [...]. According to this, society would have to start afresh, without capital, every year.4
Marx’s famous reproduction schemes, which appear in the following two chapters, are based in good part on his refutation of this ‘dogma’. 5
II Quesnay’s Conception of Reproduction
Marx begins by complimenting Quesnay for showing, in his Tableau économique, how ‘[t]he numberless individual acts of circulation [...] are grouped together [...] as a mass circulation between major economic classes of society that are defined by their functions.’6 In his demonstration of simple reproduction ‘one part of the total product [...] is [...] a bearer of old capital value reappearing in the same natural form’, i.e. ‘he comes to grips with the main question’, that reproduction includes the reproduction of constant capital.7
III Smith’s Conception of Fixed and Circulating Capital
It is with respect to this that Smith represents a ‘regression:’8 ‘[t]he narrowness of Smith’s conception lies in his failure to see what Quesnay had already seen, namely the reappearance of the value of the constant capital in a renewed form.’9
[...]
Marx now outlines the steps Smith should have made at this point in his analysis.
1 Total social product can be divided into two parts: means of production, and means of consumption.
2 The total value of the former can be divided into that of the means of production consumed in the creation of means of consumption, thus reappearing in new form; that equivalent to the sum of wages laid out by the capitalists; and that which forms the source of profits. For Smith, this first element forms no part of the net revenue, for neither the individual capitalist nor society. The other two elements, however, form revenue for the productive agents (wages for workers, profits and rents for capitalists), but not for society, for which they form capital; but the revenue-forming value components of the means of production department function as capital not in the hands of their producers, but in those of:
3 The capitalists of the means of consumption department, for whom they replace the capital used up in production of means of consumption (less that representing the sum of wages), capital now existing in the hands of the capitalists producing as means of production and thus the consumption fund for the capitalists and workers in the means of production department.
Two conclusions now stand out:
1 Even though: total social capital is the sum of individual capitals, and (therefore) total commodity product/capital is the sum of that of the individual capitals, and (therefore) that the decomposition of commodity value into its component parts holds (‘in the final analysis’16) for the total product as it does for the individual commodities, ‘the form of appearance which these components assume in the overall process of social production is [...] different.’17
2 Even under simple reproduction, the labour spent in reproducing means or production – whose value decomposes into wages (necessary labour) and surplus-value (surplus labour) – is realised in new means of production which replace the constant capital component expended in the production of means of production
[...]
VIII Labour-power as the Source of ‘Revenue’
Marx now summarises his case against Smith. The notion that wages, profit and rent, as ‘revenues’, form three components of commodity value, Marx labels as ‘absurd’. This notion in turn is based on that which says that the commodity value resolves itself into these three component parts, a notion which Marx sees as ‘more plausible’, but which is also false, and on two counts. First, as we have seen, because the ‘component’ of constant capital is missing from this scheme. But, argues Marx, even allowing for this, there is a deeper error. Insofar as a commodity has value, it does so because labour has been expended – directly and indirectly – in its production. ‘The magnitude of this value is measured by the amount of labour expended; the commodity value cannot be resolved into anything further, and consists of nothing more.’30 Under capitalist production, both the product of labour and its value belong to the capitalist. As use-value, it is entirely the product of the labour process; the same is not true of its value, for one part is the value of the means of production used up, value which has not been newly produced but which is passed on from the means of production to the product; another part is the value of the labour-power the worker sells to the capitalist, also determined in magnitude independently of the production process; a third part, that value created in production beyond the value of the labour-power sold; surplus-value. In an addendum to the chapter (taken from a different – earlier – manuscript), Marx notes that Smith’s dogma is incorporated in fundamental respects in the conceptions of, amongst others, Ricardo, Say, Proudhon, Sismondi and John Stuart Mill. ‘The result is that Smith’s confusion persists to this day, and his dogma forms an article of orthodox belief in political economy.
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Marx did not in Capital, Vol. II, use any drawings, but dealt with figures "to facilitate the understanding" (CII 402) of his analysis of the exchange-relations between the two departments of social production. We try to illustrate the interconnections, using Marx's figures from CII 407f (and 514ff) in the following schema for simple reproduction.
The reproduction schema has fifteen numbered items of which four are only of concern when considering extended reproduction.
No.1 Payment of wages for the families of labourers in department I/ selling of labour-power to be used by the capitalists for one year.
No.2 The families of labourers in department I buy means of life from department II with the money received in wages (No.1) (SG 114).
No.3 Department II buys elements of circulating constant capital from department I with the variable capital (No.1) of department I, spent on means of life (No.2).
No.4 Department II buys the rest of the circulating constant capital, that has been productively consumed during the year from department I.
No.5 The capitalists of department I buy an equal value (as expended in No.4) in means of private consumption from department I.
No.6* Department II buys additional circulating constant capital from department I.
No.7* The capitalists of department I buy an equal value (as expended in No.6) of means for their individual consumption from department II in return.
No.8 Department II buys those elements of fixed capital, that were used up during the year, from department I (SG 115).
No.9 The capitalists of department I buy at equal value (as expended in No.8) of means for their individual consumption from department II in return.
No.10* Accumulation funds of department I.
No.11 Replacement of the productively consumed constant capital of department I out of the product of department I.
No.12* Accumulation funds of department II.
No.13 Payment of wages for the families of labourers in department II/ selling of labour-power to be used by the capitalists for one year.
No.14 The families of labourers in department II buy means of life with the money received in wages (No.13) from department II.
No.15 Innerdepartmental circulation of means of individual consumption for the capitalists of department II equal in value to the surplus-value produced in department II.
(* Only in expanded reproduction)www.marxists.org/...
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coming up in the monthly book club discussion:
So Thier sets out to turn this round: “I do my best to offer enough concrete examples and jargon-free descriptions to clarify the points, which will help you keep climbing with minimal huffing and puffing.” She succeeds admirably. This book is aptly named A People’s Guide to Capitalism.
I think part of the reason for Thier’s achievement is that she is an activist in the labor movement and not an academic economist. In my experience, academic Marxist economists are usually lacking in ability to explain clearly Marxist political economic ideas to others. Thier refers to her own experience:
“when I first picked up a book on economics, I made it about two pages in before I broke down in tears, feeling hopeless that I could ever understand economics. The capitalist system in general, and economics in particular, are purposefully mystified. Analyzing how capitalism works is left to “the experts,” and if things look a little askew to you, well, that must be because you don’t know any better. This is doubly and triply so for working-class people, women, people of color, and other oppressed constituencies who are daily barraged with the message that we cannot hope to comprehend complex systems and ideas, let alone hope to impact.”
Thier says that her book “aims to follow the content and arc of Marx’s Capital. Capital’s three volumes were written to provide a theoretical arsenal to a workers’ movement for the revolutionary overthrow of the system—and to do so on the most scientific foundation possible.” But Thier rightly starts with the history of the emergence of capitalism before moving onto theory (the opposite of Marx’s approach in Capital). She deftly outlines the main concepts of Marxist economic theory, interspersed with excellent box insets on various key issues that stand on their own as insightful explanations. The subjects in these insets include: Marx on nature; the theory of marginal utility versus Marx’s value theory; how capitalism wastes so much resources; what is a bitcoin?; capitalism as a mode of production and so on.
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"Economists have every incentive to mystify their craft and to dress up their political judgments as scientific fact. Hadas Thier's A People's Guide to Capitalism is a thorough and accessible corrective, and sure to be an important primer for generations of activists." —Bhaskar Sunkara, founding editor of Jacobin
“A People’s Guide to Capitalism is a breath of fresh air on the left. Avoiding the obscure jargon of economics, Hadas Thier provides a rich, accessible introduction to how capitalism works. Ranging from exploitation at work to the operations of modern finance, this book takes the reader through a fine-tuned introduction to Marx’s analysis of the modern economy. Along the way, Thier combines theoretical explanation with contemporary examples to illuminate the inner workings of capitalism. In addition, A People’s Guide to Capitalism reminds us of the urgent need for alternatives to a crisis-ridden system.” David McNally, Cullen Distinguished Professor of History and Business at the University of Houston.
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Wealth and Poverty Do Not Determine Class
This does not just extend to workers engaged in the production of physical goods. Teachers and nurses must sell their labor in order to provide services, and thus are part of the working class.
As Marx argued: “If we may take an example from outside the sphere of material production, a school-master is a productive worker when, in addition to belaboring the heads of his pupils, he works himself into the ground to enrich the owner of the school. That the latter has laid out his capital in a teaching factory, instead of a sausage factory, makes no difference to the relation.”
It is in this sense that Marx and Engels wrote that the “proletarian is without property.” “Proletarians” is another word for workers; and private property does not mean personal belongings, like your TV or laptop, but the means of production — the buildings, machinery, software, equipment, tools, and other materials owned by capitalists.
Marx wasn’t saying that workers literally have nothing, although that is often and increasingly true. He meant that we are without any means to produce and reproduce our livelihoods, and therefore we are at the mercy of capitalist exploitation. A construction company has mechanical shovels, drills, and dozers, which allow them to exploit laborers and turn a profit. I have a shovel, which I can use to grow flowers or tomatoes.
Historian Geoffrey de Ste. Croix put it this way:
- [Class] is the collective social expression of the fact of exploitation, the way in which exploitation is embodied in a social structure. . . Class is essentially a relationship—just as capital, another of Marx’s basic concepts, is specifically described by him. . . as “a relation,” “a social relation of production,” and so forth. And a class (a particular class) is a group of persons in a community identified by their position in the whole system of social production, defined above all according to their relationship (primarily in terms of the degree of control) to the conditions of production (that is to say, to the means and labor of production) and to other classes.
Using this definition, we see that wealth and poverty do not determine class. Rather, they are manifestations of it.
The bosses are thus not defined by the degree of their extravagance. At the same time, society’s poor do not represent an “underclass” who, due to lack of employment or wealth, stand outside of society. Poverty is an integral part of the experience of the working class, and — as has been all too brutally proven by the current crisis — unemployment is just a stone’s throw away for most workers.
Even before the pandemic hit, almost half the US population could not pay their bills if they missed one paycheck, and one in four people reported foregoing health care treatment because they could not afford it. A quarter of the population had jobs that were defined as low-wage. Add to this bleak picture the mountains of student debt carried by tens of millions of people and a rising cost of living, and it is very clear just how intrinsic poverty is to the fabric of American society. Now with thirty million people without a job and forty million potentially facing homelessness in the coming months, the brutally thin line between working and destitution could not be more clear.
Capitalism in fact requires that there be some level of unemployment at all times, or as Marx termed it, a “reserve army of laborers.” The bosses depend on this reserve army of laborers to ensure that there is always someone else willing to take your job, and can thus discipline the paid workforce into acquiescing to the terms set by employers.
High levels of unemployment are a cruel feature of every downturn in the economy, but even when “times are good,” unemployment is still a painful reality for millions. What mainstream economists consider “full employment” is in fact about 5 percent unemployment. The introduction of new machinery, a growing labor force due to demographic or migration changes, regular changes in the structure of the economy (what is and isn’t produced, and where), can all contribute to unemployment during the “best” of times.
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