Section 2.- Relative Diminution of the Variable Part of Capital Simultaneously with the Progress of Accumulation and of the Concentration that Accompanies it
According to the economists themselves, it is neither the actual extent of social wealth, nor the magnitude of the capital already functioning, that lead to a rise of wages, but only the constant growth of accumulation and the degree of rapidity of that growth. (Adam
[11] "If we now return to our first inquiry, wherein it was shown that capital itself is only the result of human labour ... it seems quite incomprehensible that man can have fallen under the domination of capital, his own product; can be subordinated to it; and as in reality this is beyond dispute the case, involuntarily the question arises: How has the labourer been able to pass from being master of capital — as its creator — to being its slave?" (Von Thünen, Der isolierte Staat, Part ii, Section ii, Rostock, 1863, pp. 5, 6). It is Thiinen's merit to have asked this question. His answer is simply childish.
Smith, Book I, chapter 8.) So far, we have only considered one special phase of this process, that in which the increase of capital occurs along with a constant technical composition of capital. But the process goes beyond this phase.
Once given the general basis of the capitalistic system, then, in the course of accumulation, a point is reached at which the development of the productivity of social labour becomes the most powerful lever of accumulation.
"The same cause," says Adam Smith, "which raises the wages of labour, the increase of stock, tends to increase its productive powers, and to make a smaller quantity of labour produce a greater quantity of work."[517]
Apart from natural conditions, such as fertility of the soil, &c, and from the skill of independent and isolated producers (shown rather qualitatively in the goodness than quantitatively in the mass of their products), the degree of productivity of labour, in a given society, is expressed in the relative extent of the means of production that one labourer, during a given time, with the same tension of labour power, turns into products. The mass of the means of production which he thus transforms, increases with the productiveness of his labour. But those means of production play a double part. The increase of some is a consequence, that of the others a condition of the increasing productivity of labour. E. g., with the division of labour in manufacture, and with the use of machinery, more raw material is worked up in the same time, and, therefore, a greater mass of raw material and auxiliary substances enter into the labour process. That is the consequence of the increasing productivity of labour. On the other hand, the mass of machinery, beasts of burden, mineral manures, drain-pipes, &c, is a condition of the increasing productivity of labour. So also is it with the means of production concentrated in buildings, furnaces, means of transport, &c. But whether condition or consequence, the growing extent of the means of production, as compared with the labour power incorporated with them, is an expression of the growing productiveness of labour. The increase of the latter appears, therefore, in the diminution of the mass of labour in proportion to the mass of means of production moved by it, or in the diminution of the subjective factor of the labour process as compared with the objective factor.
This change in the technical composition of capital, this growth in the mass of means of production, as compared with the mass of the labour power that vivifies them, is reflected again in its value composition, by the increase of the constant constituent of capital at the expense of its variable constituent. There may be, e. g., originally 50 per cent, of a capital laid out in means of production, and 50 per cent, in labour power; later on, with the development of the productivity of labour, 80 per cent, in means of production, 20 per cent, in labour power, and so on. This law of the progressive increase in constant capital, in proportion to the variable, is confirmed at every step (as already shown) by the comparative analysis of the prices of commodities, whether we compare different economic epochs or different nations in the same epoch. The relative magnitude of the element of price, which represents the value of the means of production only, or the constant part of capital consumed, is in direct, the relative magnitude of the other element of price that pays labour (the variable part of capital) is in inverse proportion to the advance of accumulation.
This diminution in the variable part of capital as compared with the constant, or the altered value composition of the capital, however, only shows approximately the change in the composition of its material constituents. If, e.g., the capital value employed to-day in spinning is g constant and l
s variable, whilst at the beginning of the 18th century it was ^ constant and -\ variable, on the other hand, the mass of raw material, instruments, of labour, &c, that a certain quantity of spinning labour consumes productively to-day, is many hundred times greater than at the beginning of the 18th century." The reason is simply that, with the increasing productivity of labour, not only does the mass of the means of production consumed by it increase, but their value compared with their mass diminishes. Their value therefore rises absolutely, but not in proportion to their mass. The increase of the difference between constant and variable capital, is, therefore, much less than that of the difference between the mass of the means of production into which the constant, and the mass of the labour power into which the variable, capital is converted. The former difference increases with the latter, but in a smaller degree.
But, if the progress of accumulation lessens the relative magnitude of the variable part of capital, it by no means, in doing this, excludes the possibility of a rise in its absolute magnitude. Suppose that a capital value at first is divided into 50 per cent, of constant and 50 per cent, of variable capital; later into 80 per cent, of constant and 20 per cent, of variable. If in the meantime the original capital, say £6,000, has increased to £18,000, its variable constituent has also increased. It was £3,000, it is now £3,600. But whereas formerly an increase of capital by 20 per cent, would have sufficed to raise the demand for labour 20 per cent., now this latter rise requires a tripling of the original capital.
In Part IV it was shown, how the development of the productiveness of social labour presupposes co-operation on a large scale; how it is only upon this supposition that division and combination of labour can be organised, and the means of production economised by concentration on a vast scale; how instruments of labour which, from their very nature, are only fit for use in common, such as a system of machinery, can be called into being; how huge natural forces can be pressed into the service of production; and how the transformation can be effected of the process of production into a technological application of science. On the basis of the production of commodities, where the means of production are the property of private persons, and where the artisan therefore either produces commodities, isolated from and independent of others, or sells his labour power as a commodity, because he lacks the means for independent industry, co-operation on a large scale can realise itself only in the increase of individual capitals, only in proportion as the means of social production and the means of subsistence are transformed into the private property of capitalists. The basis of the production of commodities can admit of production on a large scale in the capitalistic form alone. A certain accumulation of capital, in the hands of individual producers of commodities, forms therefore the necessary preliminary of the specifically capitalistic mode of production. We had, therefore, to assume that this occurs during the transition from handicraft to capitalistic industry. It may be called primitive accumulation, because it is the historic basis, instead of the historic result of specifically capitalist production. How it itself originates, we need not here inquire as yet. It is enough that it forms the starting-point. But all methods for raising the social productive power of labour that are developed on this basis, are at the same time methods for the increased production of surplus value or surplus product, which in its turn is the formative element of accumulation. They are, therefore, at the same time methods of the production of capital by capital, or methods of its accelerated accumulation. The continual re-transformation of surplus value into capital now appears in the shape of the increasing magnitude of the capital that enters into the process of production. This in turn is the basis of an extended scale of production, of the methods for raising the productive power of labour that accompany it, and of accelerated production of surplus value. If, therefore, a certain degree of accumulation of capital appears as a condition of the specifically capitalist mode of production, the latter causes conversely an accelerated accumulation of capital. With the accumulation of capital, therefore, the specifically capitalistic mode of production develops, and with the capitalist mode of production the accumulation of capital. Both these economic factors bring about, in the compound ratio of the impulses they reciprocally give one another, that change in the technical composition of capital by which the variable constituent becomes always smaller and smaller as compared with the constant. Every individual capital is a larger or smaller concentration of means of production, with a corresponding command over a larger or smaller labour army. Every accumulation becomes the means of new accumulation. With the increasing mass of wealth which functions as capital, accumulation increases the concentration of that wealth in the hands of individual capitalists, and thereby widens the basis of production on a large scale and of the specific methods of capitalist production. The growth of social capital is effected by the growth of many individual capitals. All other circumstances remaining the same, individual capitals, and with them the concentration of the means of production, increase in such proportion as they form aliquot parts of the total social capital. At the same time portions of the original capitals disengage themselves and function as new independent capitals. Besides other causes, the division of property, within capitalist families, plays a great part in this. With the accumulation of capital, therefore, the number of capitalists grows to a greater or less extent. Two points characterise this kind of concentration which grows directly out of, or rather is identical with, accumulation. First: The increasing concentration of the social means of production in the hands of individual capitalists is, other things remaining equal, limited by the degree of increase of social wealth. Second: The part of social capital domiciled in each particular sphere of production is divided among many capitalists who face one another as independent commodity producers competing with each other. Accumulation and the concentration accompanying it are, therefore, not only scattered over many points, but the increase of each functioning capital is thwarted by the formation of new and the sub-division of old capitals. Accumulation, therefore, presents itself on the one hand as increasing concentration of the means of production, and of the command over labour; on the other, as repulsion of many individual capitals one from another.
This splitting-up of the total social capital into many individual capitals or the repulsion of its fractions one from another, is coun-teracted by their attraction. This last does not mean that simple concentration of the means of production and of the command over labour, which is identical with accumulation. It is concentration of capitals already formed, destruction of their individual independence, expropriation of capitalist by capitalist, transformation of many small into few large capitals. This process differs from the former in this, that it only presupposes a change in the distribution of capital already to hand, and functioning; its field of action is therefore not limited by the absolute growth of social wealth, by the absolute limits of accumulation. Capital grows in one place to a huge mass in a single hand, because it has in another place been lost by many. This is centralisation proper, as distinct from accumulation and concentration.
The laws of this centralisation of capitals, or of the attraction of capital by capital, cannot be developed here. A brief hint at a few facts must suffice. The battle of competition is fought by cheapening of commodities. The cheapness of commodities depends, ceteris paribus,* on the productiveness of labour, and this again on the scale of production. Therefore, the larger capitals beat the smaller. It will further be remembered that, with the development of the capitalist mode of production, there is an increase in the minimum amount of individual capital necessary to carry on a business under its normal conditions. The smaller capitals, therefore, crowd into spheres of production which modern industry has only sporadically or incompletely got hold of. Here competition rages in direct proportion to the number, and in inverse proportion to the magnitudes, of the antagonistic capitals. It always ends in the ruin of many small capitalists, whose capitals partly pass into the hands of their conquerors, partly vanish. Apart from this, with capitalist production an altogether new force comes into play — the credit system.b Not only is this itself a new and mighty weapon in the battle of competition. By unseen threads it, moreover, draws the disposable money, scattered in larger or smaller masses over the surface of society, into the hands of individual or associated capitalists. It is the specific machine for the centralisation of capitals.
The centralisation of capitals or the process of their attraction becomes more intense, in proportion as the specifically capitalist mode of production develops along with accumulation. In its turn, centralisation becomes one of the greatest levers of this development. It shortens and quickens the transformation of separate processes of production into processes socially combined and carried out on a large scale.
The increasing bulk of individual masses of capital becomes the material basis of an uninterrupted revolution in the mode of production itself. Continually the capitalist mode of production conquers branches of industry not yet wholly, or only sporadically, or only formally, subjugated by it. At the same time there grow up on its soil new branches of industry, such as could not exist without it. Finally, in the branches of industry already carried on upon the capitalist basis, the productiveness of labour is made to ripen, as if in a hothouse. In all these cases, the number of labourers falls in proportion to the mass of the means of production worked up by them. An ever increasing part of the capital is turned into means of production, an ever decreasing one into labour power. With the extent, the concentration and the technical efficiency of the means of production, the degree lessens progressively, in which the latter are means of employment for labourers. A steam plough is an incomparably more efficient means of production than an ordinary plough, but the capital value laid out in it is an incomparably smaller means for employing men than if it were laid out in ordinary ploughs. At first, it is the mere adding of new capital to old, which allows of the expansion and technical revolution of the material conditions of the process of production. But soon the change of composition and the technical transformation get more or less completely hold of all old capital that has reached the term of its reproduction, and therefore has to be replaced. This metamorphosis of old capital is independent, to a certain extent, of the absolute growth of social capital, in the same way as its centralisation. But this centralisation which only redistributes the social capital already to hand, and melts into one a number of old capitals, works in its turn as a powerful agent in this metamorphosis of old capital.
Endnotes
[11] 1 ' The plan outlined here was not realised by Marx. The work referred to here as Book II, was published by Engels as Volume II of Capital (1885) after Marx's death, and Book III as Volume III of Capital (1894). Book IV was not published in Marx's or Engels' lifetime. See also Note 2.— 11, 565
[517] 5 " A. Smith, An Inquiry into the Nature..., Edinburgh, London, 1814, Vol. I, p. 142.— 617