Nos. 70 & 71, April 2018

Nos. 70 & 71 (April 2018)
India's Working Class and its Prospects

India's Working Class and its Prospects

II. What Capital says, and does not say

In order to relate what Marx says about the capitalist system and about the condition and role of workers in that system, to what we find in India, let us turn to Capital, vol. I.

In Capital vol. I, Marx examines the capitalist mode of production. He says that “the ultimate aim of this work [is] to reveal the economic law of motion of modern society”. (Marx 1990, p. 92)  And since the whole point of the book is that it is the workers who above all need to overthrow capitalism, Capital is addressed not to intellectuals but to workers. Below we briefly summarise what it says to the workers:5

The secret of capitalist wealth: exploitation The secret of the wealth of the capitalist lies in the exploitation of you and your fellow workers. When you get a job working for a capitalist, you sell your labour power, your capacity to labour, for a specific length of time, in exchange for a wage. The wage the capitalist pays you is enough to reproduce your labour power – that is, it meets your consumption needs. (It also meets the needs of your family, thereby ensuring the production of the next generation of labourers, after you get worn out like an old tool.) Once the capitalist has bought your labour power for the working day, he puts you to labour. The “use value” of your labour power is the labour you actually do for the capitalist in that working day.

Labour is an activity; labour power is a commodity, a thing which is bought and sold. In less time than the number of hours for which you have sold yourself, your labour generates the value of your wage. When the production process yields just enough to restore the conditions with which it started (including the wear and tear of machinery, plant, etc), it is called ‘simple reproduction’. But if you stopped working then, the capitalist would earn no profit. He says: “I have bought your labour power for the full 8 (or 10, 12, etc) hours that I paid for. Continue working!” Thus the remaining hours of the labour you perform are in fact surplus labour.

You have no share in the goods made by you; they all belong to the capitalist. If the capitalist successfully sells these goods, he not only gets back the value of all the material inputs that went into the goods and the value of your labour power, but he gets the surplus value (generated by your surplus labour) as well. If he simply consumes all that surplus value, production stays at the same level. But in fact he sets aside a part of the surplus value, which gets added to the capital he already owns. So this capital is nothing but your own labour, alienated from you. Now dead and congealed, it is used against you.

Surplus value, then, is not created by the capitalist or by a sum of money. It is not created by merchants in the course of buying and selling (i.e., ‘exchange’). It is generated in the course of production, through your living labour. Once surplus value is generated, the industrial capitalist shares that surplus value with the landlord (in  the form of rent for the land on which the factory stands), the banker (in the form of interest on loans given for putting up the factory), and the merchant (in the form of trade margins on finished goods distributed by him).

What drives the capitalist There is a fundamental difference between what drives you, the worker, and what drives the capitalist. You sell your Commodity (labour power) for a sum of Money, in order to buy other Commodities (food, clothing, shelter, etc). This we can depict as “C-M-C”. This cycle makes sense for you, because the Commodity you begin with (labour power) is by its nature different from the ones you end with, even if both have the same exchange value. The next day, you must repeat this cycle, failing which you and your family will have to starve.

The capitalist, by contrast, begins with Money. He buys Commodities (raw materials, your labour power, etc). Then he produces additional Commodities with your labour; which he then sells for Money. Since the Money he gets at the end is by its nature no different from what he began with, this cycle only makes sense to him if the second sum of Money is larger. So we can depict this as “M-C-M ”. The difference between the first “M” and the second “M” is surplus value, which becomes capital. The capitalist’s purpose in life is to accumulate more and more capital.

Capital has not invented surplus labour. Wherever a part of society possesses the monopoly of the means of production, the labourer, free or not free, is forced to work longer than needed for his/her own maintenance, adding an extra working-time in order to produce the means of subsistence for the owners of the means of production. But in societies before capitalism, the owning class was mainly interested in getting use-values, goods or services that could be consumed by that class, and so that set the limits to surplus labour. It is only under capitalist society that the aim of production is to accumulate capital, for which there is no limit, and hence the thirst of the capitalist for surplus labour is boundless.

At first the capitalist increases his capital by lengthening the working day intolerably, exhausting you to the point where you are physically depleted; this process is termed ‘Absolute Surplus Value’, since it involves simply increasing the surplus labour hours in absolute terms. But as workers wage a long and bitter struggle to limit the length of the working day, the capitalist is forced to find other ways to expand his capital. He turns more and more to increasing the productivity of each worker, by introducing new technology, investing the capital he has earlier accumulated. (He can also increase productivity by increasing the intensity of your work, through reorganising the labour process.) As the capitalist increases the productivity of each worker, the portion of the working day in which you reproduce the value of your wages gets reduced, leaving more hours of your working day to expand his capital. This is termed ‘Relative Surplus Value’, as a relatively larger share of your working day is now going to generate surplus value. The larger and larger the share of surplus labour in your working day, the greater your exploitation.

This process, repeated over and over on an expanding scale and continuously increasing the productivity of the worker, is called the accumulation of capital. The capitalist himself is under compulsion to keep accumulating capital and raising the technological level, failing which he cannot compete with other capitalists. In fact, one capitalist always kills many. There is an inherent tendency for capital to get more and more centralized in a few hands.

The infancy and growth of capitalism: “Capital” is not simply a sum of money, or a bunch of machines. It is essentially a relation, the capitalist’s control over the unpaid labour of the worker. In order for this relation to emerge, both capitalists and ‘free’ labourers must come into being.

It is a myth that the capitalist’s original sum of capital was accumulated through prudence or thrift. In fact, it was accumulated through a bloody process of expropriation of the peasantry, plunder of the colonies, the slave trade, the use of laws and the police to drive down wages of workers, private ownership of government debt (this debt is serviced by the State through heavy taxes on the people), commercial wars, etc.

When peasants are robbed of their land, they become ‘free’ labourers, in the double sense: workers like you are neither bound to any lord, nor do you have land or other means of production of your own. You have the ‘freedom’ to work for the capitalist – or to starve.

In the infancy of capitalist production, the capitalist was able to make savings simply by assembling traditional craftsmen under a single roof. This is termed ‘cooperation’. Later the capitalist began dividing the tasks so that each set of workers focussed on just one part of the job. Each worker’s skills got highly developed in one type of work (at the cost of his/her other capacities), and productivity rose. This stage was termed ‘manufacture’. But even at this stage the technology, and hence the labour process, were essentially no different from the past; the difference was that workers worked collectively for a single capitalist. It is in the stage of machinery and modern industry that capitalism really takes over the labour process and re-shapes it. With the advent of the machine, with its own motive force (e.g., steam), the tool is freed from the physical limits of the workman. Now it is not the worker who uses the tool; it is the machine that employs the workman, as a mere appendage to its activity. This cheapens labour power, since it requires neither skill nor strength to do the job. Both the de-skilled nature of the work and the lowering of wages to inhuman levels degrade the labourer, and the pool of potential workers becomes much larger.

The reserve army, used to keep down wages: The capitalist keeps accumulating capital by re-investing a portion of the surplus in increasing productivity, by replacing labour with machines. As accumulation proceeds, so does the growth of a ‘reserve army’ of unemployed workers. The existence of this ‘army’ helps the capitalist keep down your wages, since he can always threaten you with your replacement. There are three wings to this reserve army. One is the ‘floating reserve’, workers who are retrenched from time to time, whether due to labour-saving machinery, or the downturn in the industrial cycle, and who can be quickly re-absorbed in the upswing. The second is the ‘latent reserve’, the workers who are in reality surplus in capitalist agriculture, and who can be absorbed in industry if the opportunity emerges. The third is the ‘stagnant reserve’, those who are working, often for longer hours than those employed in modern industry, but at much lower wages, or in low-income self-employment (similar to what we call the ‘informal’ or ‘unorganised’ sector today). 

Even as production gets more and more socialised, capital gets centralised in the hands of fewer and fewer magnates. At the other pole grow misery, oppression, slavery, degradation, exploitation, and the revolt of the working class. Centralization of the means of production and socialization of labour at last reach a point at which they cannot be reconciled with private ownership of the means of production. This contradiction can only be resolved by a revolution in which the working class takes power, abolishes private property, and expropriates the expropriators.

Gaps, real or perceived, in the theory
The above summary only touches on some of the important themes, mainly from volume I, in Marx’s rich three-volume work.

Marx’s theory has been subject to many attacks by the defenders of capitalism. But even among those who share his hatred for exploitation and oppression, his theory has been faulted for failing to provide an account of three important questions in relation to capitalism: nature; gender; and colonialism. The criticisms are along the following lines.

One criticism is that Marx, in focussing on human productive activities, failed to take into account the contribution of natural wealth, as well as the ‘side’ effects of the capitalist production process, in particular the irreversible degradation of nature as a result of human activities. Recent studies have confirmed that this accusation is not valid: Marx had in fact theorized the relation between human beings and nature, and had shown how capitalism sets human productive activity against nature.6

Capitalism, based on the accumulation drive, is blind to all damage which can be externalised from its short-term costs. Nor was Marx unaware of the contribution of nature to wealth: rather, he emphatically refuted those who ignored this, pointing out that “Labour is not the source of all wealth. Nature is just as much the source of use values (and it is surely of such that material wealth consists!) as labour, which itself is only the manifestation of a force of nature, human labour power.” (Marx 1875)

Capital spells out the method by which capitalist society measures value, which excludes costs that it can shove off onto others (including nature) without compensation. But Capital no more endorses that capitalist method than it endorses capitalist society. Its goal is a society in which society is not ruled by the individual drive for the accumulation of exchange values; instead, the members of society freely associate to bring about the full development of human abilities to meet human needs, material and spiritual. 

A second criticism is that, in Marx’s model of capitalism, the source of surplus value is shown to be the labour of the worker. However, such a focus ignores the labour of reproduction of labour power, in which women have the main role. Indeed the labour of reproduction is not sufficiently elaborated in Marx’s writings. But his frame and method provide us with much of the equipment needed to take fuller and continuing account of these. In fact, Marx’s concept of ‘cost of reproduction’ can be used to show how the oppressed condition of women aids the capitalist: For this helps obscure and systematically devalue women’s unpaid household labour, and thereby helps the capitalist keep down the wages of the worker.7

Finally, Marx’s model is criticised for not incorporating the considerable, perhaps key, contribution of flows of colonial plunder (and slavery) to the development of capitalism. To the extent Marx takes account for this contribution, it appears to be restricted to gathering capital for the launch of capitalism; but in fact the flows of colonial/neo-colonial surplus were and are required for the sustenance of capitalism.

Let us look at how four aspects are dealt with by Marx: the role of colonial plunder in the process of primitive (primary) accumulation of capital in Europe; the impact of colonial rule on the colonial societies; its impact on the consciousness of the workers in the colonising countries; and the importance of colonial exploitation to the very sustenance and reproduction of capitalism.

(i) Capital is explicit about the importance of colonial plunder to the development of capitalism in Europe. And there can scarcely be a more scathing depiction of the orgy of loot and bloodshed that was colonialism than is found in Chapter 31 of Capital vol. I, which ends: “If money, according to Augier, comes into the world with a congenital blood-stain on one cheek, capital comes dripping from head to toe, from every pore, with blood and dirt.” (Marx 1990, 926)

(ii) At first, in his article in the New York Daily Tribune “The Future Results of British Rule in India” (1853), Marx imagined that the destruction and horrors wrought by British rule would precipitate an industrial revolution in India. But by the time he wrote Capital, Marx instead remarked that colonialism creates a worldwide division of labour, by destroying native industry in the colonies, and thus forcing them to turn into producers of raw materials for the coloniser. Marx, in his later writings, came to the view that colonial rule cast development backward, and that for their progress the colonised people would have to overthrow colonial rule. (Ghosh 1985, 91-108) In a draft of a letter to Vera Zasulich written in 1881, Marx wrote that in India “the suppression of communal land ownership was nothing but an act of English vandalism which drove the indigenous population backward rather than forward.” (Marx 1881) By this point, Marx’s critique had become deep and damning: British rule was not developing India but bleeding it “with a vengeance.”8 He looked forward to the people of the colonised countries freeing themselves from British rule, not waiting for a proletarian revolution in Britain to free them. (iii) In Capital itself he states a very important proposition: “Labour in a white skin cannot emancipate itself where it is branded in a black skin.” (Marx 1990, 414) While this is said with reference to the impact of slavery on the working class in the United States, he came to apply the same principle to question of Britain’s colonies and the British working class. Just three years after the publication of Capital vol. I, Marx wrote (in a circular to the International Workingmen’s Association) that “to hasten the social revolution in England... the decisive blow must be struck in [the British colony] Ireland;” and here, too, he reiterates the principle: “A nation that enslaves another forges its own chains.” (Lenin would later apply this invaluable principle not only to various dimensions of the national question, but to the women’s question too9; and it can be applied to caste domination in India as well.)

(iv) In Marx’s original plan for Capital, two entire volumes were to deal with foreign trade and with the world market and crisis. He later changed his plan, but it is possible that, had he been able to complete his theoretical work, he would have spelled out the continuing contribution of colonial exploitation to sustaining capitalism after the stage of primitive accumulation as well. At any rate, his remarks on the scale of Britain’s “bleeding” of India, and the fact that this bleeding was a continuing enrichment of Britain in the 1880s, clearly indicate his views by the end of his life. It fell to Lenin, deeply immersed in Marx’s method, to analyse the rise of finance capital and imperialism by the turn of the century.

In the current phase of imperialism, with the massive growth of outsourcing from the imperialist countries in the North to low-wage countries like China and India, Marx’s revelation that surplus value is generated in the course of production is an invaluable weapon. Bourgeois economics preaches that most of the ‘value added’ in goods outsourced to the low-wage countries is actually added in the course of transporting, insuring and retailing the goods in the imperialist countries, since the bulk of the income from the goods accrues in the latter. But this is a mere bourgeois obfuscation which covers up imperialist exploitation. Basing ourselves on Marx’s analysis (see Smith 2016), we can see that the surplus value actually generated in the course of production in the low-wage country is then captured by firms in the imperialist countries. Thus a Bangladeshi garment worker who sews a shirt may receive a pittance as wages, and the Bangladeshi capitalist who gets the shirt sewn may receive a small share of the surplus value generated, but Walmart and other firms in the imperialist countries grab the overwhelming share of that surplus value, in the name of ‘value added’ in retailing and the like.

When we discuss the working class of India, we will touch upon some of the above themes, including women’s labour of reproduction, and the impact of colonial plunder and exploitation on the Indian economy.


5. We have deliberately not attempted to cover all important aspects from vol. I. Points such as abstract labour, socially necessary labour time, money, constant and variable capital, rate of surplus value, and so on, have been left out in this summary. Nor have we covered the processes of circulation and distribution of capital, dealt with in vol.s II & III. (back)

6. In particular, this has been brought out in the work of John Bellamy Foster and others, in several books as well as articles in Monthly Review and elsewhere. (back)

7. Engels said that “The modern individual family is founded on the open or concealed domestic slavery of the wife, and modern society is a mass composed of these individual families as its molecules.” (Engels, 1884, Chapter II) There were several reasons Marx did not pursue this line of inquiry in Capital. Among them was the fact that, at the time Marx was writing, the capitalist production process was thrusting women and children into the industrial workforce in huge numbers, working long hours in extremely degraded conditions. It thus appeared that capitalism would virtually demolish the working class marriage and family. Toward the later part of the 19th century, however, capitalist society, forced by working class struggles to limit the working day, and fattened by its exploitation of the colonies, sytematically restored the working class family as an institution in the imperialist strongholds. It began paying the male worker a wage that apparently would suffice to sustain the entire household – but at the same time keeping the wage down with the unpaid household labour of the woman, a role now re-sanctified by bourgeois ideology. See Foster and Clark, 2018. (back)

8. “What the English take from them [the Indians] annually in the form of rent, dividends for railways useless to the Hindus; pensions for military and civil servicemen, for Afghanistan and other wars etc. – what they take from them without any equivalent and quite apart from what they appropriate to themselves annually within India – speaking only of the value of the commodities the Indians have gratuitously and annually to send over to England – it amounts to more than the total sum of income of the 60 millions of agricultural and industrial labourers of India! This is a bleeding process with a vengeance!” – Marx, 1881a. (back)

9. Zetkin, 1934. Lenin refers to how the “old master right of the man” undermines their revolutionary spirit. (back)



NEXT: The occupational structure of India


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