PART THREE
http://www.globalresearch.ca/index.php?context=va&aid=13156by Prof. Michael A. Lebowitz
Global Research, April 13, 2009
Capitalists’ need for an expanding market 58. The problem, though, is that the market is not a bottomless pit. In the sphere of circulation, capitalists face a barrier to their growth—the extent of the market. In the same way, then, that the logic of capital drives capitalists to increase surplus value within the sphere of production, it also compels them to increase the size of the market in order to realize that surplus value. If you can’t make the surplus value real by selling the commodities containing surplus value, why produce those commodities? Once you understand the nature of capitalism, you can see why capital is necessarily driven to expand the sphere of circulation.
Globalization of needs
59. Whatever the size of the market, capitalists are always attempting to expand it. Faced with limits in the existing sphere of circulation, capital drives to widen that sphere. How? One way is spatially—by spreading existing needs in a wider circle. “The tendency to create the world market is directly given in the concept of capital itself. Every limit appears as a barrier to be overcome,” Marx commented. Thus, capital strives “to tear down every spatial barrier” to exchange and to “conquer the whole earth for its market.”
60. In this process, the mass media play a central role. The specific characteristics of national cultures and histories mean nothing to capital—through the mass media, capital’s logic tends to conquer the world through the homogenization of standards and needs everywhere. Everywhere the same commercials, the same commodities, the same culture—unique cultures and histories are a barrier to capital in the sphere of circulation.
Creating new needs to consume
61. There’s another way that capital expands the market—by “the production of new needs.” The capitalist, Marx pointed out, does everything he can to convince people to consume more, “to give his wares new charms, to inspire them with new needs by constant chatter, etc.” This is not new—Marx wrote this in the middle of the nineteenth century when capitalist production was still relatively underdeveloped. In the twentieth century, though, the development of the specifically capitalist mode of production made the sales effort essential; but, it wasn’t only the greater productivity that created the problem—capital’s success in driving up the rate of exploitation makes the realization of surplus value a central problem for capital.
62. Thus, the ability of capital to move to low-wage countries to manufacture commodities that are exported back to the more developed world significantly increases the gap between productivity and real wages—i.e., increases the rate of exploitation in the world. And, it means that the sales effort to move commodities through the sphere of circulation must intensify. There’s no greater proof of capital’s victories in the sphere of production than what it is prepared to spend to create new needs in order to sell.
63. Look at the salaries offered to professional athletes. Why are those salaries (and product endorsement fees) so astronomical? It’s all about advertising—i.e., all about realizing surplus value. (The more people who watch sports on TV, the higher the rates that the mass media capitalists can charge the capitalists who are compelled to advertise.) In this respect, there is more than just an obscene contrast between the low wages of women producing, e.g., Nike shoes and the high endorsement fees that Nike pays athletes; there is, indeed, an organic link as the result of the high degree of exploitation.
Exploitation in the sphere of circulation
64. But, exploitation doesn’t only take place in the sphere of production. To turn commodities containing surplus value into money, capitalists must not only stimulate needs; they also require people to work selling those commodities. And, of course, they want to spend as little as possible in their circulation costs; thus, the logic of capital dictates that it should exploit such workers involved in selling these commodities as much as possible. The greater the exploitation of such workers (in other words, the greater the gap between the hours they work and the hours of labor contained in their wage), the lower capital’s costs of selling and the higher the profits after sale.
65. The best way to exploit workers in the sphere of circulation is by using casual, part-time, and precarious workers. Those are workers who are easily separated and divided; they find it difficult to combine against capital, and they thus compete against each other. This competition can become quite intense when there is very high unemployment; not only can capital then drive wages in this sector down—it can also transfer the risk of selling to workers.
Informal workers
66. In other words, a large reserve army of the unemployed makes it possible for capital to use “the informal sector” to complete the circuit of capital. These workers are part of the circuit of capitalist production and circulation (since, for the most part, commodities sold by “buhoneros” are produced within capitalist relations); however, they have none of the benefits and relative security of workers formally employed by capital. They look like independent operators (and even think of themselves this way—a great victory for capital!) but they depend upon the capitalist, and the capitalist depends upon them to sell those commodities containing surplus value. Like unorganized workers everywhere, they compete against each other (and also against workers in the “formal” sphere of circulation). Who gains from this? As usual, capital benefits as the result of the competition among workers.
Why capitalism faces crises
67. Capital, we see, is constantly trying to expand the market in order to realize surplus value. But it doesn’t always succeed. Capital tends to expand the production of surplus value beyond its ability to realize that surplus value. Why? Because of its successes in the sphere of production—in particular, its success in driving up the rate of exploitation. What capital does in the sphere of production comes back to haunt it in the sphere of circulation: by striving “to reduce the relation of this necessary labor to surplus labor to the minimum” (i.e., to increase the rate of exploitation), capital simultaneously creates “barriers to the sphere of exchange, i.e., the possibility of realization—the realization of the value posited in the production process.” Overproduction, Marx commented, arises precisely because the consumption of workers “does not grow correspondingly with the productivity of labor.”
68. Thus, overproduction is “the fundamental contradiction of developed capital.” Capitalist production takes place, Marx pointed out, “without any consideration for the actual limits of the market or the needs backed by the ability to pay”; as a result, there is a “constant tension between the restricted dimensions of consumption on the capitalist basis, and a production that is constantly striving to overcome these immanent barriers.”
Crisis and the sphere of production
69. The first sign of an imbalance between the ability to produce surplus value and the ability to realize it is intensified competition among capitalists. It demonstrates that too much capital is being accumulated (i.e., invested) relative to the limits of the market. Ultimately, though, the effect of this imbalance is crisis—“momentary, violent solutions for the existing contradictions, violent eruptions that re-establish the disturbed balance for the time being.” Commodities don’t sell and, naturally, if commodities cannot be sold, they will not be produced under capitalism because the profits aren’t there. And so, production is reduced and lay-offs are announced—even though the potential to produce is there and people have needs. Capitalism is not, after all, in the business of charity.
The nature of capitalism comes to the surface
70. And, that is exactly what capitalist crisis makes it possible to see about the nature of capitalism: profits—rather than the needs of people as socially developed human beings—determine the nature and extent of production within capitalism. What other economic system could generates the simultaneous existence of unused resources, unemployed people, and people with unmet needs for what could be produced? What other economic system would allow people to starve in one part of the world while elsewhere there is an abundance of food and where the complaint is “too much food is being produced”?
71. But no crisis necessarily leads people to question the system itself. People struggle against specific aspects of capitalism—over the workday, the level of wages and working conditions, the unemployment brought about by a crisis of overaccumulation, capital’s destruction of the environment, and the destruction of national cultures and sovereignty, etc.—but unless they understand the nature of the system, they struggle merely for a nicer capitalism, a capitalism with a human face.
72. Nevertheless, capital doesn’t want a nicer capitalism. It wants profits. And, even though workers may not be trying to end capitalism but are just struggling for fairness within capitalism, their struggles may challenge the drive for profits. In this case, capital may find it necessary to reveal another side of the logic of capital.
Capital’s state—the market and state in capitalism
73. Capital’s motto is: “As much market as possible, as much state as necessary.” In its early days, Marx stressed, capital had great need for the state: “the rising bourgeoisie needs the power of the state.” Why? Because all of the elements capital required for the system to reproduce itself spontaneously were not yet in place. For creating the institutions that would allow capitalism to flourish, capital needed to subordinate all elements of society to itself through the coercive power of the state (e.g., “grotesquely terroristic laws”); it used this power, for example, to compel workers “into accepting the discipline necessary for the system of wage-labor.”
The ‘common sense’ that capital creates
74. With the development of the specifically capitalist mode of production, however, Marx suggested that the need for state intervention on behalf of capital would be lower. The way in which the particular productive forces introduced by capital degrade the worker and “alienate from him the intellectual potentialities of the labor process,” the way that “the advantages of machinery, the use of science, invention, etc.” are necessarily viewed as attributes of capital, and the way in which workers are displaced and divided through the introduction of new technology—all this contributes significantly to make workers feel dependent and powerless in the face of capital.
75. Fully developed, Marx proposed, capitalist production itself sets “the seal on the domination of the capitalist over the worker.” Because capital constantly replenishes the reserve army of labor in the normal course of capitalist production, the market is sufficient to compel workers to accept the rule of capital. Thus, Marx stated that capital itself “breaks down all resistance,” producing “a working class which by education, tradition and habit looks upon the requirements of that mode of production as self-evident natural laws.”
The state as capital’s ultimate weapon
76. Yet, workers do resist, do struggle for their needs. And, the market is not always sufficient by itself to ensure that capital gets the profits which are its goal and source of life. So, capital turns to the state—“as much state as necessary.” It is prepared to destroy trade unions, do away with all pretences of democratic forms, to turn to fascism to get what it wants—the coercive power of the state and “grotesquely terroristic laws” are not a characteristic only of emerging capitalism. Both at its beginning and when fully developed, capital creates the state it needs.
Underlying basis for imperialism
77. And, this is not only true internally. Capital’s drive for profits is the underlying basis for imperialism. In addition to its search for new, cheaper sources of raw materials and new markets in which to sell commodities, capital wants workers who can be exploited. It seeks those who are weak, those who are willing to work for low wages and under poor working conditions, and those who are separated from other workers; thus, capital will move production to secure such advantages. When you understand the logic of capital, you understand that global capitalism is inherent in capital itself—that it drives “to tear down every spatial barrier” to its goal of profits.
78. Here again, to achieve its goal, capital follows the motto of “as much market as possible, as much state as necessary.” As long capital can get what it needs through the market—e.g., as the result of the competition of primary producing countries to sell inputs or the availability of a large pool of workers to exploit in production—it need not draw too heavily upon the coercive power of the imperialist state.
Capital and its state help its market
79. But capital has many weapons before it turns to direct coercion. Where do the dominant ideas about the magic of the market come from? In economics departments, it is not the economists who are critical of the market who get research and financial support from capital and its state. In the battle of ideas, capital draws upon the ideology that interference with the market necessarily leads to disaster and that all attempts to use the state to do good make things worse. Since economists who don’t agree are labeled “bad economists,” they tend to be unemployed or marginalized; thus, the voices everyone hears from economists (and through the media) are the ones that shout “TINA!”—there is no alternative to the market, there is no alternative for poorer countries (indeed, all countries) but to follow the commands of the market.
80. No one could ever accuse capital, though, of relying solely upon the power of ideas. Capital also uses its state to create institutions which ensure that the market will command. International institutions such as the International Monetary Fund, the World Bank, the World Trade Organization, and so-called free trade agreements all have been created to enforce the logic of capital. How? By punishing those who dare to think otherwise, countries that try to develop a policy independent of the dominant capitalist powers.
81. Add to that, imperialism’s “Fifth Column”—the independence and autonomy of Central Banks—and you have the package of institutions that capital uses to foster policies of neoliberalism: policies which remove all restrictions on the movement of capital, remove all laws that protect workers, consumers, and citizens against capital, and reduce the power of the state to check capital (while increasing the power of the state to act on behalf of capital).
Imperialism and the colonial state
82. Despite all this, you can’t stop people from struggling ultimately for their own self-development. In such cases, capital uses the imperialist state to intervene militarily and to support, both by subversion and by financial and military resources, colonial and client states that act to produce conditions for the reproduction of the capitalist world order. And this occurs especially once capital has decided to generate surplus value directly in the periphery—now it must have the assurance that its investments will be protected.
83. With the support of local oligarchies and elites, these colonial states are assigned the function of creating the framework in which the market serves capital best. By separating agricultural producers from the land and providing special economic zones for capital to function freely, these instruments of global capital make available the reserve army of labor that capital wants. Further, they are there to police—to use their coercive power and “grotesquely terroristic laws” to attack challenges to the logic of capital. Whenever these colonial states are unable to carry out this function, though, capital demands as much direct imperialist intervention as necessary.
84. Imperialism, in short, will stop at nothing. Its history of barbarism demonstrates this over and over again. As Che Guevara pointed out, it is a bestiality that knows no limits—one that tries to crush under its boots anyone who fights for freedom.
The essence of imperialism
85. Imperialism is inherent in capital’s goal of surplus value, in its drive “to tear down every spatial barrier” to that goal. Not surprisingly, at various times the competition between capitalists of different countries to expand may lead them to call upon their particular states to give them particular advantages in the exploitation of colonies—thus leading to a competition among imperialist states. However, the fundamental contradiction has always been between capital and the working classes, between the imperialist state and the colonial producers—and, in this, all imperialist states have a common interest.
Capitalism and human development—capitalism’s vicious circle
86. Think about the kind of people that capitalism produces. We have seen that capitalism cripples people in the process of production. Rather than creating the conditions in which people can develop all their potential, capital treats people as means to its goal, profits. Their productive activity is commanded by this external power; they relate to their work, to the products of their work, to the means for their work, to each other, as alien. Capitalist production, we see, is a process that produces impoverished human beings. And those people, producers who have gained little satisfaction from their work, are driven to find satisfaction in the articles of consumption which they are able to command with the wages they have received.
87. What we can observe clearly here is the vicious circle of capitalism. Here we begin with people (a) who are separated from the means of production and with needs which they must fulfill. Those people (B) must go into the labor market to sell their labor power—competing with other people in the same situation. They © enter into capitalist production, that process which yields as its result impoverished workers with both the need and the means to consume, within circumscribed limits. Having (d) consumed these alien products, however, they are once again without the means to maintain themselves and must present themselves again to capital; they must once again produce for capital’s goals. This is a vicious circle, and its phases are interdependent—you cannot change one without changing them all.
The vicious circle grows
88. And yet, there is more to this vicious circle of capitalism, because the circle is growing. It grows because of the drive of capital to expand. Precisely because capital generates new surplus value within the production process as the result of exploitation and expands its capacity to produce in order to grow, it must also expand the sphere of circulation of commodities by constantly generating new needs to consume. Because capital must grow, it devotes enormous human and material resources to conjure up new artificial needs. It seduces people into a life of consumerism (which can never be fully satisfied), and it must do this—it must sell more and more commodities. It must create new needs, new needs which increase our dependence upon capital. This is why Marx commented that the “contemporary power of capital rests” upon the creation of new needs for workers.
Limits?
89. Thus, capitalism is a growing circle—a spiral of growing alienated production, growing needs and growing consumption. But how long can that continue? Everyone knows that the high levels of consumption achieved in certain parts of the world cannot be copied in the parts of the world that capital has newly incorporated in the world capitalist economy. Very simply, the earth cannot sustain this—as we can already see with the clear evidence of global warming and the growing shortages which reflect rising demands for particular products in the new capitalist centers. Sooner or later, that circle will reach its limits. Its ultimate limit is given by the limits of nature, the limits of the earth to sustain more and more consumption of commodities, more and more consumption of the earth’s resources.
90. But even before we reach the ultimate limits of the vicious circle of capitalism, there inevitably will arise the question of who is entitled to command those increasingly limited resources. To whom will go the oil, the metals, the water—all those requirements of modern life? Will it be the currently rich countries of capitalism, those that have been able to develop because others have not? In other words, will they be able to maintain the vast advantages they have in terms of consumption of things and resources—and to use their power to grab the resources located in other countries? Will newly emerging capitalist countries (and, indeed, those not emerging at all) be able to capture a “fair share”? Will the impoverished producers of the world—producers well aware of the standards of consumption elsewhere as the result of the mass media—accept that they are not entitled to the fruits of civilization? Does anyone really think this question is going to be left to the market? Indeed, this is precisely the case where capital will use “as much state as necessary.”
The specter of barbarism
91. The specter of barbarism is haunting the world. How could anyone ever think that capitalism is a path to human development? Yes, of course, some people have always been able to develop much of their potential within capitalism—but all people cannot. Why? Because the very nature of capitalism depends upon the ability of some people to monopolize the fruits of human activity and civilization and to exploit and exclude others. Capitalism has never been a society in which the free development of each is the condition for the free development of all; however, the implications of its inherent injustice and inequality are obvious now that the limits to its particular pattern of expansion have become apparent.
Socialism and human development
92. There is an alternative—an alternative which flows from the logic of human development. Consciously or unconsciously, people have fought long for that alternative; they have opposed the logic of capital with the logic of human development. In every struggle for human dignity and social justice—in every struggle for better wages and working conditions, against racism and patriarchy, for protecting our living environment, and for our rights to adequate health, education, and housing (among our other needs), the concept of human development is implicit. These are struggles to remove the barriers to our full and complete development.
93. Implicit, too, in our collective struggles is the concept that we are all connected—that we need each other, that indeed the free development of each is the condition for the free development of all. The alternative is a society based upon love and solidarity, upon our unity as a human family, “the unity of man with man, which is based on the real differences between men” (Marx).
94. That society, of course, can’t be one in which the state decides, where there is the continuation of the division between thinking and doing, where we are dominated (in the workplace, the community, or the household), and where there is inequality in our ability to develop our potential. After all, what kind of people are produced in such a society? As the Bolivarian Constitution recognizes, the human development alternative can only be a democratic, participatory, and protagonistic society—one in which our participation, our practice, is the necessary condition of ensuring our “complete development, both individual and collective.”
Creating rich human beings
95. The logic of human development points to our need to be able to develop through our democratic, participatory, and protagonistic activity in every aspect of our lives. Through revolutionary practice in our communities, our workplaces, and in all our social institutions we can produce ourselves as what Marx called “rich human beings”—rich in capacities and needs—in contrast to the impoverished and crippled human beings that capitalism produces. Understanding the logic of human development demonstrates the perverse, anti-human logic of capital and points to the alternative we need to build.
96. In contrast to the hierarchical capitalist state (which Marx understood as an “engine of class despotism”) and to the despotism of the capitalist workplace, only a revolutionary democracy can create the conditions in which we can invent ourselves daily as rich human beings. This concept is one of democracy in practice, democracy as practice, and democracy as protagonism. Democracy in this sense—protagonistic democracy in the workplace and protagonistic democracy in neighborhoods, communities, and communes—is the democracy of people who are transforming themselves into revolutionary subjects.
The elementary triangle of socialism
97. Not only is this revolutionary democracy necessary to identify the needs and capacities of communities and workers but it is also the way to build the capacities of the protagonists and to foster a new social relation among producers, the relation of associated producers based upon solidarity. How else but through protagonistic democracy in production can we ensure that the process of producing is one that enriches people and expands their capacities rather than crippling and impoverishing them? How else but through protagonistic democracy in society can we ensure that what is produced is what is needed to foster the realization of our potential?
98. If there is to be democratic production for the needs of society, however, there is an essential precondition: there cannot be a monopolization of the products of human labor by individuals, groups, or the state. In other words, the precondition is social ownership of the means of production, the first side of what President Hugo Chávez has called the “elementary triangle” of socialism: (a) social ownership of the means of production, which is a basis for (B) social production organized by workers in order to © satisfy communal needs and communal purposes.
99. Let us consider each element in this particular combination of distribution-production-consumption.
A. Social ownership of the means of production
100. Social ownership of the means of production is critical because it is the only way to ensure that our communal, social productivity is directed to the free development of all rather than used to satisfy the private goals of capitalists, groups of individuals, or state bureaucrats. Social ownership is not, however, the same as state ownership. State property can be the basis for state capitalist enterprises, hierarchical statist firms, or firms in which particular groups of workers (rather than society as a whole) capture the major benefits of this state property. Social ownership, however, implies a profound democracy—one in which people function as subjects, both as producers and as members of society, in determining the use of the results of our social labor.
B. Social production organized by workers
101. Social production organized by workers builds new relations among producers—relations of cooperation and solidarity. In contrast to capitalist production, it allows workers to end “the crippling of body and mind” and the loss of “every atom of freedom, both in bodily and in intellectual activity” that comes from the separation of head and hand. As long as workers are prevented from developing their capacities by combining thinking and doing in the workplace, they remain alienated and fragmented human beings whose enjoyment consists in possessing and consuming things. And, if workers don’t make decisions in the workplace and develop their capacities, we can be certain that someone else will. Protagonistic democracy in the workplace is an essential condition for the full development of the producers.
C. Satisfaction of communal needs and purposes
102. Satisfaction of communal needs and purposes focuses upon the importance of basing our productive activity upon the recognition of our common humanity and our needs as members of the human family. Thus, it stresses the importance of going beyond self-interest to think of our community and society. As long we produce only for our private gain, how do we look at other people? As competitors or as customers—i.e., as enemies or as means to our own ends; thus, we remain alienated, fragmented, and crippled. Rather than relating to others through an exchange relation (and, thus, trying to get the best deal possible for ourselves), this third element of the elementary triangle of socialism has as its goal the building of a relation to others characterized by our unity based upon recognition of difference. As in the case of programs of ALBA (the Bolivarian Alternative for the Americas), we build solidarity among people and at the same time produce ourselves differently.
103. And, this concept of solidarity is central because it is saying that all human beings, all parts of the collective worker, are entitled to draw upon our “communal, social productivity.” The premise is not at all that we have the individual right to consume things without limit but, rather, that we recognize the centrality of “the worker’s own need for development.” Further, our claim upon the accumulated fruits of social brain and hand is not based upon exploitation. It is not because you have been exploited that you are entitled to share in the fruits of social labor. Rather, it is because you are a human being in a human society—and because, like all of us, you have the right to the opportunity to develop all your potential.
104. At the same time, as a human being in a human society, you also have the obligation to other members of this human family—to make certain that they also have this opportunity, that they too can develop their potential. As a member of this family you are called upon to do your share—a point present in the Bolivarian Constitution: Article 135 notes “the obligations which by virtue of solidarity, social responsibility and humanitarian assistance, are incumbent upon individuals according to their abilities.”
The defects we inherit
105. Of course, completing the socialist triangle is not something that can occur overnight. The implications of this are significant. For example, producing for communal needs and purposes requires a democratic mechanism for transmitting needs from below in order to engage in conscious coordination and planning. However, the communal needs and purposes initially identified will be the needs of people formed within capitalism—people who are “in every respect, economically, morally and intellectually, still stamped with the birth marks of the old society.” Similarly, how can production be oriented toward society when self-interest of the producers still prevails? And how, under these conditions, can we ensure that property is truly social? Without production for social needs, there can be no real social property; without social property, no worker decision-making oriented toward society’s needs; without worker decision-making, no transformation of people and their needs. The failure to complete that triangle means that the defects inherited from the old society infect everything. So, how can you create socialism for the twenty-first century when everything depends upon everything else?
Revolutionary practice
106. The problem, in short, is how to create new socialist men and women at the same time as new material conditions are developed. It can only occur through a process—one in which people transform themselves through their practice. We always need to remember the concept of revolutionary practice—“the simultaneous changing of circumstance and human activity or self-change.” That process by which people prepare themselves for a new society, we see, can only be one of real democracy, protagonistic democracy, democracy as practice.
107. Democratic decision-making within the workplace (instead of capitalist direction and supervision), democratic direction by the community of the goals of activity (in place of direction by capitalists), production for the purpose of satisfying needs (rather than for the purpose of exchange), common ownership of the means of production (rather than private or group ownership), a democratic, participatory, and protagonistic form of governance (rather than a state over and above society), solidarity based upon recognition of our common humanity (rather than self-orientation), the focus upon development of human potential (rather than upon the production of things)—all these are means of producing new human beings, the limbs of a new organic system, socialism for the twenty-first century.
The virtuous circle of socialism
108. What kind of people do we create as we build this new socialism? They are quite different from those produced within capitalism. In contrast to the “vicious circle of capitalism,” socialism contains a “virtuous circle.” We begin with (a) producers who live within a society characterized by solidarity—people who recognize their unity based upon differences. These producers (B) enter into an association in order to produce for the needs of society and © in this process develop and expand their capacities as rich human beings. Thus the product of their activity is (d) producers who recognize their unity and their need for each other. They, accordingly, reenter into this process of the virtuous circle of socialism.
109. Like the vicious circle of capitalism, this, too, is an expanding circle. However, its growth is not driven by the logic of capital—a logic which demands greater production, greater consumption of the earth’s resources, and greater consumption. On the contrary, the growth driven by the logic of human development is not a quantitative growth but rather a qualitative growth—the development of all-sided, rich social individuals. There are no inherent limits here—except the full development of all human potential.
The path to human development
110. In contrast to that socialist triangle (social property, social production, and social needs), think about the capitalist triangle—(a) private ownership of the means of production and (B) exploitation of workers for © the drive for profits. Does anyone seriously think that this can be the path to human development?
111. The only path is socialism. But, knowing where we want to go and the path to take us there is only the beginning.
112. We know that capitalism and imperialism will do everything they can to divert us, to divide us, to convince us that there is no alternative.
113. We know we have to be prepared to fight.
114. If we believe in people, if we believe that the goal of a human society must be that of “ensuring overall human development,” our choice is clear:
115. Socialism or barbarism