Front Page Titles (by Subject) I. General Economies. - Capital: A Critique of Political Economy. Volume III: The Process of Capitalist Production as a Whole
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I. General Economies. - Karl Marx, Capital: A Critique of Political Economy. Volume III: The Process of Capitalist Production as a Whole 
Capital: A Critique of Political Economy. Volume III: The Process of Capitalist Production as a Whole, by Karl Marx. Ed. Federick Engels. Trans. from the 1st German edition by Ernest Untermann (Chicago: Charles H. Kerr and Co. Cooperative, 1909).
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I. General Economies.
THE increase of absolute surplus-value, or the prolongation of surplus-labor and thus of the working day, while the variable capital remains the same and employs the same number of laborers at the same nominal wages, no matter whether overtime is paid for or not, reduces relatively the value of the constant capital as compared to the total and the variable capital, and thereby increases the rate of profit even aside from the growth and mass of surplus-value and a possibly rising rate of surplus-value. The volume of the fixed portion of constant capital, such as factory buildings, machinery, etc., remains the same, no matter whether they serve for 16 or for 12 hours in the labor-process. A prolongation of the working day does not require any new expenditures for this most expensive portion of the constant capital. Furthermore, the value of the fixed capital is thereby reproduced in a smaller number of periods of turn-over, so that the time for which it must be advanced in order to make a certain profit is abbreviated. A prolongation of the working day therefore increases the profit, even if overtime is paid, or even if it is paid better, up to a certain limit, than the normal hours of labor. The ever more pressing necessity for the increase of fixed capital in modern industry was therefore one of the main reasons which induced profit-loving capitalists to prolong the working day.11
The same conditions do not obtain if the working day is constant. In that case it is necessary either to increase the number of laborers and with them to a certain extent the mass of fixed capital (buildings, machinery, etc.), in order to exploit a greater quantity of labor (for we leave aside the question of deductions from wages or depression of wages below their normal level), or, if the intensity of labor and the productivity of labor are to be augmented and more relative surplus-value produced, the quantity of the circulating portion of constant capital increases in those lines which use raw materials, since more raw material is worked up within a certain time. And in the second place, the mass of machinery set in motion by the same number of laborers also increases, in other words, both portions of constant capital increase. An increase in surplus-value, then, is accompanied by a growth of the constant capital, the growing exploitation of labor goes hand in hand with a heightened expenditure of the means of production by which labor is exploited, in other words, a greater investment of capital. The rate of profit is therefore reduced on one side while it increases on the other.
Quite a number of running expenses remain almost or entirely the same, whether the working day is long or short. The cost of supervision is smaller for 500 working men during 18 working hours than for 750 working men during 12 working hours. "The running expenditures of a factory at ten hours of labor are almost as high as at twelve hours." (Report of Factory Inspectors, October, 1848, page 37.) State and municipal taxes, fire insurance, wages of various permanent employes, depreciation of machinery, and various other expenses of a factory, run on just the same, whether the working time is long or short. To the extent that production decreases, these expenses rise as compared to the profit. (Reports of Factory Inspectors, October, 1862, page 19.)
The period in which the value of machinery and of other components of fixed capital is reproduced is practically determined, not by the mere duration of time, but by the duration of the entire labor-process during which it serves and wears out. If the laborers must work 18 hours instead of 12, it makes a difference of three days per week, so that one week is stretched into one and a half, and two years into three. If this overtime is not paid for, then the laborers supply the capitalists not only with the normal surplus-labor without receiving an equivalent, but also give one week out of every three, and one year out of every three, for nothing. In this way the reproduction of the value of the machinery is speeded up by 50% and accomplished in two-thirds of the time which would be ordinarily required.
We start in this analysis, and in that of the fluctuations of the prices of raw materials (chapter VI), from the assumption that the mass and rate of surplus-value are given quantities, in order to avoid useless complications.
We have already shown in our presentation of co-operation, of division of labor and machinery, that economies in the conditions of production, such as are found in production on a large scale, are mainly due to the fact that these conditions are social ones growing out of the combination of labor-processes. The means of production are worked up by the aggregate laborer, a co-operation of many laborers on an immense scale, instead of by laborers operating in a disconnected way or co-operating at best on a small scale. In a large factory with one or two central motors the cost of these motors does not increase at the same rate as their horse-powers and their resulting extension of activity. The cost of transmission of power does not grow at the same rate as the number of working machines set in motion by it. The frame of any individual machine does not become dearer at the same rate as the number of tools which it employs as its organs. And so forth. The concentration of means of production furthermore saves buildings of various sorts, not only for actual working rooms, but also for storage sheds, etc. It is the same with expenses for fuel, light, etc. Other conditions of production remain the same, whether used by many or by few.
This entire line of economies arising from the concentration of means of production and their use on a large scale has for its fundamental basis the accumulation and co-operation of working people, the social combination of labor. Hence it has its source quite as much in the social nature of labor as the surplus-value considered individually has its source in the surplus-labor of the individual laborer. Even the continual improvements possible and necessary in this line are due solely to the social experiences and observations made in production on a large scale through the combination of social labor.
The same is true of the second great branch of economies in the conditions of production. We refer to the reconversion of the excrements of production, the so-called offal, into new elements of production, either of the same, or of some other line of industry; the processes by which these so-called excrements are thrown back into the cycle of production and consequently of consumption, whether productive or individual. This line of economies, which we shall examine more closely later on, is likewise the result of social labor on a large scale. It is the abundance of these excrements due to large scale production which renders them available for commerce and turns them into new elements of production. It is only as excrements of combined production on a large scale that they become valuable for the productive process as bearers of new exchange-values. These excrements, aside from the services which they perform as new elements of production, reduce the cost of raw material to the extent that they are saleable. For a normal loss is always calculated as a part of the cost of raw material, namely the quantity ordinarily wasted in its consumption. The reduction of the cost of this portion of constant capital increases to that extent the rate of profit, assuming the amount of the variable capital and the rate of surplus-value to be given quantities.
If the surplus-value is given, then the rate of profit can be increased only by a reduction of the value of the constant capital required for the production of commodities. To the extent that the constant capital enters into the production of commodities, it is not its exchange-value, but its use-value, which is taken into consideration. The quantity of labor which the flax can absorb in a spinnery does not depend on its exchange-value, but on its quantity, assuming the degree of productivity of labor, that is to say, the stage of technical development, to be given. In like manner the assistance rendered by a machine to, say, three laborers does not depend on its exchange-value, but on its use-value as a machine. In one stage of technical development a bad machine may be expensive, in another a good machine may be cheap.
The increased profit gathered by a capitalist through the cheapening of such things as cotton, spinning machinery, etc., is the result of a heightened productivity of labor. Of course, this improvement was not introduced in the spinnery, but in the cultivation of cotton and the building of machinery. There it required a smaller expense for the fundamentals of production in order to materialize a certain quantity of labor and secure possession of a certain amount of surplus-labor. This means a reduction of the expense required for the appropriation of a certain quantity of surplus-labor.
We mentioned in the foregoing the savings realized in the process of production by the co-operative use of the means of production by socially combined laborers. Other economies, resulting in the expenditure of constant capital from the shortening of the time of circulation (a result brought about largely by the development of the means of communication) will be discussed later on. At this point we shall mention the economies due to progressive improvements of machinery, namely 1) of its substance, such as iron for wood; 2) the cheapening of machinery by the improvement of methods of manufacture, so that the value of the fixed portion of constant capital, while continually increasing with the development of labor on a large scale, does not grow at the same rate;12 3) the special improvements enabling the existing machinery to work more cheaply and effectively, for instance, improvements of steam boilers, etc., which will be further discussed later on; 4) the reduction of waste through better machinery.
Whatever reduces the wear of machinery, and of the fixed capital in general, for any given period of production, cheapens not only the individual commodity, seeing that every individual commodity reproduces in its price its share of this wear and tear, but reduces also the aliquot portion of the invested capital for this period. Repair work, etc., to the extent that it becomes necessary, is figured in with the original cost of the machinery. A reduction of the expense for repairs, due to a greater durability of the machinery, reduces the price of this machinery correspondingly.
It may be said also of these economies, at least of most of them, that they are possible only through the combination of labor and are often not realized until production is carried forward on a still larger scale, so that they are due to an even greater combination of laborers in the direct process of production.
On the other hand, the development of the productive power of labor in any one line of production, for instance in the production of iron, coal, machinery, buildings, etc., which may be in part connected with improvements on the field of intellectual production, especially in natural science and its practical application, appears to be the premise for a reduction of the value, and consequently of the cost, of means of production in other lines of industry, for instance in the textile business or in agriculture. This follows naturally from the fact that a commodity, which issues as a product from a certain line of production, enters into another as a means of production. Its dearness or cheapness depends on the productivity of labor in that line of production from which it issues as a product. Thus it is at the same time a basic condition, not only for the cheapening of commodities into whose production it enters as a means of production, but also for the reduction of the value of constant capital, whose element it becomes, and thereby for the increase of the rate of profit.
The characteristic feature of this kind of economies in the constant capital due to the progressive development of industry is that the rise in the rate of profit in one line of industry is the result of the increase of the productive power of labor in another. That which the capitalist appropriates in this case is once more a gain which is the product of social labor, although not a product of the laborers directly exploited by him. Such a development of the productive power is traceable in the last instance to the social nature of the labor engaged in production; to the division of labor in society; to the development of intellectual labor, especially of the natural sciences. The capitalist thus appropriates the advantages of the entire system of the division of social labor. It is the development of the productive power of labor in its exterior department, in that department which supplies it with means of production, which relatively lowers the value of the constant capital employed by the capitalist and consequently raises the rate of profit.
Another raise in the rate of profit is produced, not by economies in the labor creating the constant capital, but by economies in the operation of this capital itself. On one hand, the concentration of laborers, and their co-operation on a large scale, saves constant capital. The same buildings, appliances for fuel and light, etc., cost relatively less for large scale than for small scale production. The same is true of power and working machinery. Although their absolute value increases, it falls relatively in comparison to the growing extension of production and the magnitude of the variable capital, or to the mass of labor-power set in motion. The economy realized by a certain capital within its own line of production is first and foremost an economy in labor, that is to say, a reduction of the paid labor of its own laborers. The previously mentioned economy is distinguished from this one by the fact that it accomplished the greatest possible appropriation of the unpaid labor in other lines in the most economical way, that is to say, with as little expense as a certain scale of production will permit. To the extent that this economy does not rest on the previously mentioned exploitation of the productivity of the social labor employed in the production of constant capital, or in an economy arising from the operation of the constant capital itself, it is due either directly to the co-operation and social nature of labor within a certain line of production, or to the production of machinery, etc., on a scale in which its value does not grow at the same rate as its use-value.
Two points must be kept in view here: First, if the value of c were zero, then p' would be equal to s', and the rate of profit would be at its maximum. In the second place, the most important thing for the direct exploitation of labor is not the exchange-value of the employed means of exploitation, whether they be fixed capital, raw materials or auxiliary substances. In so far as they serve as means to absorb labor, as media in and by which labor and surplus-labor are materialized, the exchange-value of buildings, raw materials, etc., is quite immaterial. That which is ultimately essential is on the one hand the quantity of them technically required for their combination with a certain quantity of living labor, and on the other hand their fitness; in other words, not only the machinery, but also the raw and auxiliary materials must be good. The good quality of the raw material determines in part the rate of profit. Good material leaves less waste. A smaller mass of raw materials is then needed for the absorption of the same quantity of labor. The resistance to be overcome by the working machine is also less. This affects in part even the surplus-value and the rate of surplus-value. The laborer consumes more time with bad raw materials than he would with the same quantity of good material. Wages remaining the same, this implies a reduction of the surplus-labor. Furthermore this affects materially the reproduction and accumulation of capital which depend more on the productivity than on the mass of labor employed, as shown in volume I.
The fanatic hankering of the capitalist after economies in means of production is therefore intelligible. That nothing is lost or wasted, that the means of production are consumed only in the manner required by production itself, depends partly on the skill and intelligence of the laborers, partly on the discipline exerted over them by the capitalist. This discipline will become superfluous under a social system in which the laborers work for their own account, as it has already become practically superfluous in piece-work. This fanatic love of the capitalist for profit is expressed, on the other hand, by the adulteration of the elements of production, which is one of the principal means of reducing the value of the constant capital in comparison with the variable capital, and thus of raising the rate of profit. In addition to this, the sale of these elements of production above their value, so far as this value reappears in the product, plays a considerable role in cheating. This practice plays an essential part particularly in German industry, whose maxim seems to be: People will surely appreciate getting first good samples and then inferior goods from us. However, these matters belong in a discussion of competition, and do not further concern us here.
It should be noted that this raising of the rate of profit by means of a depreciation in the value of the constant capital, in other words, by a reduction of its expensiveness, is entirely independent of the fact whether the line of industry, in which this takes place, produces articles of luxury, necessities of life for the individual consumption of laborers, or means of production. This circumstance would be of material importance only in the case that it would be a question of the rate of surplus-value, which depends essentially on the value of labor-power, and consequently on the value of the customary necessities of the laborer. But in the present case the surplus-value and the rate of surplus-value have been assumed as given. The proportion of the surplus-value to the total capital, which determines the rate of profit, depends under these circumstances exclusively on the value of the constant capital, and in no way on the use-value of the elements of which this capital is composed.
A relative cheapening of the means of production does not, of course, exclude the absolute increase of their aggregate values. For the absolute scope of their application grows extraordinarily with the development of the productive power of labor and the parallel extension of the scale of production. The economies in the use of constant capital, from whatever point of view they may be considered, are the result, either exclusively of the fact that the means of production serve as co-operative materials for the combined laborers, so that the resulting economies appear as products of the social nature of directly productive labor itself; or, in part, of the fact that the productivity of labor is developed in those spheres which supply capital with means of production, and in that case these economies present themselves once more as products of the development of the productive forces of social labor, provided only that the total labor is compared with the total capital, and not simply with the laborers employed by the individual capitalist owning this particular constant capital. The difference in this case is merely that the capitalist takes advantage not only of the productivity of labor in his own establishment, but also of that in other establishments. Nevertheless, the capitalist presumes that the economies of his constant capital are wholly independent of his laborers and have nothing at all to do with them. On the other hand, the capitalist is always well aware that the laborer has something to do with the fact whether the employer buys much or little labor with the same amount of money (for this is the form in which this transaction between the laborer and the capitalist appears in the mind of the latter). The economies realized in the application of constant capital, this method of getting a certain result out of the means of production with the smallest possible expense, is regarded more than any other power inherent in labor as a peculiar gift of capital and as a method characteristic of the capitalist mode of production.
This conception is so much less surprising as it seems to be borne out by facts. For the conditions of capitalist production conceal the internal connection of things by the utter indifference, alienation, and expropriation practiced against the laborer in the matter of the material means in which his labor must be incorporated.
In the first place, the means of production constituting the constant capital represent only the money of the capitalist (just as the body of the Roman debtor represented the money of his creditor, according to Linguet). The laborer comes in contact with them only in the direct process of production, in which he handles them as use-values of production, as instruments of labor and materials of production. The increase or decrease of the value of these things are matters which affect his relation to the capitalist no more than the fact that he may be working up either copper or iron. Occasionally, however, the capitalist likes to profess a different conception of the matter, as we shall indicate later on. He does so whenever the means of production become dearer and thereby reduce his rate of profit.
In the second place, so far as these means of production in the capitalist process of labor are at the same time means of exploiting labor, the laborer is no more concerned in the relative dearness or cheapness of these means of exploitation than a horse is concerned in the dearness or cheapness of the bit and bridle by which it is steered.
In the third place, we have seen previously that the social nature of labor, the combination of the labor of a certain individual laborer with that of other laborers for a common purpose, stands opposed to that laborer and his comrades as a foreign power, as the property of a stranger which he would not care particularly to save if he were not compelled to economize with it. It is entirely different in the factories owned by the laborers themselves, for instance, in Rochdale.
It requires hardly any special mention, then, that the general interconnection of social labor, so far as it expresses the productivity of labor in one line of industry by a cheapening and improvement of the means of production in another line, and thereby a raising of the rate of profit, affects the laborers as a matter foreign to them and concerning only the capitalists, since they are the ones who buy and own these means of production. The fact that the capitalist buys the product of the laborers of another line of industry with the product of the laborers in his own line, and that he disposes of the product of the laborers of another capitalist by virtue of having appropriated the unpaid products of his own laborers, is mercifully concealed for him by the process of circulation and its attending circumstances.
This state of things is further complicated by the fact that these economies in the employment of constant capital assume the guise of being due to the peculiar nature of the capitalist mode of production, and to the special function of the capitalist in particular. The thirst for profits and the demands of competition tend toward the greatest possible cheapening of the production of commodities, just as production on a large scale first develops in its capitalistic form.
Capitalist production promotes on the one hand the development of the productive powers of social labor, and on the other it enforces economies in the employment of constant capital.
However, capitalist production does not stop at the alienation and expropriation of the laborer, the bearer of living labor, from his interest in the economical, that is to say, rational and thrifty, use of the material requirements of his labor. In conformity with its contradictory and antagonistic nature, capitalist production proceeds to add to the economies in the use of constant capital, and thus to the means of increasing the rate of profit, a prodigality in the use of the life and health of the laborer himself.
Since the laborer passes the greater portion of his life in the process of production, the conditions of this productive process constitute the greater part of the fundamental conditions of his vital activity, his requirements of life. Economies in these requirements constitute a method of raising the rate of profit, just as we observed on previous occasions that overwork, the transformation of the laborers into laboring cattle, constitutes a means of self-expanding capital, of speeding up the production of surplus-value. Such economies are: The overcrowding of narrow and unsanitary rooms with laborers, or, in the language of the capitalist, a saving in buildings; a crowding of dangerous machinery into one and the same room without means of protection against this danger; a neglect of precautions in productive processes which are dangerous to health or life, such as mining, etc.; not to mention the absence of all provisions to render the process of production human, agreeable, or even bearable, for the laborer. From the capitalist point of view, such measures would be quite useless and senseless. No matter how economical capitalist production may be in other respects, it is utterly prodigal with human life. And its saving in one direction is offset by a waste in another, owing to the distribution of its products through trade and the competitive method. Capitalism loses on one side for society what it gains on another for the individual capitalist.
Just as capital endeavors to reduce the direct application of living labor to necessary labor, and to abbreviate the labor required for the production of any commodity by the exploitation of the social productiveness of labor and thus to use as little living labor as possible, so it has also the tendency to apply this minimized labor under the most economical conditions, that is to say, to reduce the value of the employed constant capital to its minimum. While the value of commodities is determined by the necessary labor-time contained in them, not by all of the labor-time incorporated in them, it is the capital which gives reality to this determination and at the same time reduces continually the labor-time socially necessary for the production of a certain commodity. The price of that commodity is thereby lowered to its minimum, since every portion of the labor required for its production is reduced to its minimum.
It is necessary to make a distinction in the economies realized in the employment of constant capital. If the mass, and consequently the amount of the value, of the employed capital increases, it means primarily a concentration of more capital in one hand. Now, it is precisesly this greater mass in one hand, going hand in hand, as a rule, with an absolute increase but relative decrease of the number of employed laborers, which permits economies in constant capital. From the point of view of the individual capitalist the volume of the necessary investment of capital, especially of its fixed portion, increases. But compared to the mass of the worked-up materials and of the exploited labor the value of the invested capital relatively decreases.
This will now be briefly illustrated by a few examples. We begin at the end, with economies in the conditions of production which are at the same time the living conditions of the laborer.
[11.] Since in all factories a very large amount of fixed capital is invested in buildings and machinery, the gains will be so much larger the greater the number of hours during which this machinery can be kept employed." (Reports of Factory Inspectors, October 31, 1858, p. 8.)
[12.] See Ure on the progress in factory construction.