Wednesday, February 15, 2012

Contradictions in Capitalism

Contradictions in capitalism

Published Feb 13, 2012 9:35 PM

Following are excerpts from a talk given by Workers World Party organizer Richard Kossally at a WWP forum in New York City on Feb. 3.

Out of feudal society arose the bourgeoisie, a new class that was to dominate society.

Succeeding social systems are birthed by the social system immediately preceding them. The bourgeoisie came out of a privileged middle layer that developed in feudal society. Karl Marx states in Chapter 31 of “Capital,” “Doubtless many small guild-masters, and yet more independent small artisans, or even wage laborers, transformed themselves into small capitalists, and (by gradually extending exploitation of wage labor and corresponding accumulation) into full-blown capitalists.”

For a time the conflicting modes of feudal and capitalist production existed side by side, but one had to win out. The capitalist mode of production requires the freedom of capital. This was incompatible with feudal ties to the land, with the secrecy of the trade guilds, and with the general organization of feudal society.

The feudal organization of society was doomed.

Before the emergence of the capitalist mode of production, products were made from start to finish on an individual basis. As manufacture was introduced, the old mode of production fell by the wayside.

Manufacture, with different workers doing different tasks on the same product, was superior to the whole product being made by a individual worker, as it required less labor time to produce a given product. The commodities of the two different modes of production had to be sold on the same market. The individual producer could not compete and had no choice but to become a wage worker.

With the constant upgrading of machinery characterized by capitalism, the product of the individual worker decreased even more in market value, not because the quality of the product produced was poorer, but because it required too much labor time as compared to the social product of the factory.

Bosses expropriate what the workers produce

Under capitalism, production became socialized. That is, many workers hired by a capitalist and their collective labor, combined within an establishment with a definite production plan, produce useful commodities for exchange in order to make a profit for the capitalist. None of the products that are produced by the workers belong to them; they all belong to the capitalist. The workers receive a fraction of the value of what their labor produced in the form of wages.

This is one of the major contradictions within capitalism: the individual capitalist appropriates to himself or herself that which was produced socially by many workers. The worker is a wage slave. The product of his or her labor belongs to another. The wage of the worker in general is just enough for him or her and his or her family to make it to the next payday. He or she is a wage worker for life.

The profit of the capitalist, on the other hand, serves to further enslave the worker. Some of it will be used to further revolutionize the means of production, by investing it in better and/or more machines to expand the capitalist's enterprise, and still have enough left to live very high on the hog.

This capitalist does not exist alone. In whatever industry, the capitalists who produce the same or similar thing engage in fierce competition and always try to undersell each another. They use different tactics to cheapen the products that the workers produce. They buy more sophisticated manufacturing machines, and they intensify the exploitation of their workforce by making the workers work harder and/or longer.

The constant perfecting of machinery also displaces workers, as fewer workers are needed with the new machinery. As Frederick Engels said, “The very product of the worker is turned into an instrument for his subjugation.” The threat of replacing workers is a very powerful tool that the capitalists possess. They use this threat as downward pressure on the wages of the employed and to extract as much as they can out of each worker. So under capitalism, the increased productivity of the worker leads to still further exploitation.

Anarchy built into capitalist production

It is necessary for the capitalists to drop the price of the product in order to outsell their competition. But if prices are lowered, then many more items have to be produced and sold for the capitalist to maintain or increase his or her profits. Production soon outpaces consumption, as this competition eventually leads to more products on the market than can be sold at a profit.

If the capitalist has more items than can be sold profitably, then factories are closed and the workers laid off, left idle and without income. They cannot buy back the products they have made. There is a protracted stagnation until the market glut eases, the excess products are finally sold off, and production picks up again. This state of overproduction is the result of what we communists refer to as the anarchy in production.

The individual capitalist will very accurately figure out how much raw material and machinery are needed and how many workers to exploit in order to have so much end product, but they have no general plan for meeting the needs of society. Their only goals are profit and survival.

The competition that did away with the feudal mode of production has turned into competition between capitalists. It ever intensifies, and the weaker ones are always under threat of ruin. This, however, is not the kind of ruin that the workers face. A capitalist enterprise might be absorbed by a stronger enterprise or have to close shop and have its capital employed somewhere else. In any case, the ruin of any capitalist is not worth the shedding of any worker's tears.

The system itself is unstable. These competing capitalists are driven by an underlying law of capitalism — expand or die. At a time of protracted stagnation the stronger capitalists absorb the weaker ones. The suffering of the workers intensifies. As Engels states, “The mass of the workers are in want of the means of subsistence because they have produced too much of the means of subsistence”.

War is not one of the inventions of capitalism, but under capitalism the instruments of war have been revolutionized to a degree that could not have been imagined before production became socialized. A single device today can kill more people than were killed in entire wars of earlier periods. The capitalist governments are not shy about employing their weapons. They are on a permanent war footing.

Capitalism breeds monopolization

The capitalists that survive these cyclical crises and emerge as victors are fewer in number and bigger and stronger — monstrous beasts that further exploit workers' labor power. So the anarchy in production in capitalist society leads to monopoly. Today, the capitalist class, through just a few hundred banks, corporations and other institutions, controls the commerce of the entire world.

In search of markets and resources, the capitalists have shown that they will do anything. As the famous words of a Mr. Dunning quoted by Marx go, “A certain 10 percent [profit] will ensure the employment of capital anywhere; 20 percent certain will produce eagerness; 50 percent, positive audacity; 100 percent will make it ready to trample all human laws; 300 percent, and there is no crime at which it will scruple, nor a risk it will not run, even to the chance of its owner being hanged.”

These days, though, hanging or any other punishment is less of a possibility for the capitalist. After all, it is their system and as such, it is designed to serve them. The rapid advance of the productive capacity of the world with the means of production primarily in the employ of the capitalist class has concentrated such absurd wealth in the hands of the capitalists as to be beyond obscene.

Capitalism was a dialectical inevitability in the evolution of human society. Previous social systems developed slowly. Capitalism has developed the means of production very rapidly, but in a relatively short time has outlived any usefulness. Capitalism cannot absorb the masses of unemployed workers. It has reached a point where there is now a new situation: We are living in the era of the jobless recovery.

The fundamental contradictions of capitalist production lead to other serious contradictions. These contradictions of capitalism are inherent in the system itself: Capitalist competition inevitably leads to crisis. These contradictions cannot be done away with within the bounds of the capitalist system. They occur independently, outside the will and control of the capitalists themselves.

Irrational system creating its gravediggers

Capitalism is not a rational system. Capitalists serve no necessary function in present society and are responsible for just about all the problems of society. The atrocities committed against the planet in their reckless pursuit of riches are mind boggling. The pursuit of oil and natural gas without study or precaution against potential risks is among the most harmful. The very air that we breathe and the water that we drink, two of the essentials that support life, have been poisoned by the capitalists. It is an amazing contradiction that capitalist competition causes them to be so reckless that they cause a reduction in the quality of the water that we drink and the air that we breathe. I presume that they drink the same water and breathe the same air.

My favorite contradiction of this rotten system is this: By constantly revolutionizing the means of production, communication and commerce, the capitalists have created a massive world proletariat. This class, our class, will be their undoing. They have created their own gravediggers. The historical task of the proletariat is the abolishing of capitalism and the construction of socialism.

Thinking rationally, the increased productivity of labor should not create misery for the producers nor should productivity lead to scarcity. Abundance should not be the source of distress and want. As long as the social product of the working class is stolen by the capitalist class, society cannot advance in any meaningful way.

No country as yet has achieved the goal of socialism, but those that have attempted it, and those that are aspiring to the socialist construction of society have more than proven that a planned economy is what the people of the world need. A major lesson learned by the attempt at state power by the Paris Commune in 1871 is that the capitalist must be uprooted. There has to be revolutionary change and there has never been a revolution without a revolutionary party. Welcome to Workers World.

The entire talk can be seen at
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