Marx

The history of all hitherto existing society is the history of class struggles.

Capitalist development can be seen both from the view of bourgeois and the proletariat. Let us look at
the bourgeoisie first. The modern bourgeois system that has sprouted from the ruins of feudal society
has not done away with class antagonisms. It has but established but new classes, new conditions of
oppression, and new forms of struggle in place of the old ones.

The modern bourgeoisie is itself the product of a long course of development, a series of revolutions in
the modes of production and of exchange. A corresponding political advance of that class accompanied
each step in the development of the bourgeoisie.

The capitalist system has some negative points, when we look at he position of the bourgeois over the
proletariat. First, for exploitation, veiled by religious and political illusions, the bourgeoisie has
substituted naked, shameless, direct, brutal exploitation. Second, the bourgeoisie has stripped every
occupation hitherto honored and looked up to. It has converted the physician, the lawyer, the priest, the
poet, and the man of science, into its wage-labourers. Third, the bourgeoisie cannot exist without
constantly revolutionizing the instruments of production, and thereby the relations of production, and
with them the whole relations of society. Fourth, the bourgeoisie, during its rule of scarce one hundred
years, has created more massive and more colossal productive forces than have all preceding
generations together. Subjection of nature’s forces to man, machinery, application of chemistry to
industry and agriculture, steam-navigation, railways, electric telegraphs, clearing of whole continents for
cultivation, canalization of rivers, whole populations conjured out of the ground. Last, development of
industries whose products are consumed, not only at home, but also in every quarter of the globe. In
place of the old wants, satisfied by the productions of the country, we find new wants, requiring for
their satisfaction the products of distant lands and climes.

Let us now look at the capitalist development from the view of proletariat. The proletariat, the modern
working class, developed a class of labourers, who live only so long as they find work, and who find work
only so long as their increases capital. These labourers are a commodity, like every other article of
commerce, and are consequently exposed to competition, to all the fluctuations of the market.

Owing to the extensive use of machinery and to division of labour, the work of the proletarians has lost
all individual character. The proletarian becomes an appendage of the machine. As the use of machine
and the division of labour increases, in the same proportion the burden of toil also increases, whether
by prolongation of working hours, or by the increase of the work extracted in a given time. Modern
industry has converted the little workshop of the patriarchal master into the great factory of the
industrial capitalist. The proletariats are daily and hourly enslaved by the machine, by the over looker,
and, above all, by the individual bourgeois himself.

The proletariat goes through various stages of development. With its birth begins its struggle with the
bourgeoisie. At first individual labourers, carry on the contest then by the workpeople of a factory, then
by the operative of one trade, in one locality, against the individual bourgeois who directly exploits
them. They direct their attacks not against the bourgeois conditions of production, but against the
instruments of production themselves; they destroy imported wares that compete with their labour,
they smash to pieces machinery, they set factories ablaze.

Class Conflict:

There is always a class conflict between the proletariat and the bourgeois. With the development of
industry, the proletariat increases not only in number, but also becomes concentrated in greater
masses; its strength grows. The collisions between individual workmen and individual bourgeois take
more and more the character of collisions between two classes. The workers begin to form
combinations (Trades’ Unions) against the bourgeois; they club together in order to keep up the rate of
wages; they found permanent associations in order to make provision beforehand for these occasional
revolts. Every class struggle is a political struggle. Collisions between the classes of the old society
further the course of development of the proletariat.

The proletarians cannot become masters of the productive forces of society, except by abolishing their
own previous mode of appropriation, and thereby also every other previous mode of appropriation. The
essential condition for the existence of the bourgeois class is the formation and augmentation of capital;
the condition for capital is wage-labour. Wage-labour rests exclusively on competition between the
labourers. The advance of industry, the involuntary promoter of which is the bourgeoisie, replaces the
isolation of the labourers, due to competition, by the revolutionary combination, due to association. Its
fall and the victory of the proletariat are equally inevitable. Therefore, in a revolution, the proletarians
have nothing to lose but their chains. In the words of Marx, “Working men of all countries, unite!”

Before we go on to understand the capitalist mode of development in greater detail, we need to first
look at some of the basics which are important to understand the capitalist mode of development.
These include wage labour and capital and their relationship, theory of surplus value. Only then can we
go on to understand the capitalist mode of production and the class relations that it entails.

Wage Labour and Capital

Introduction by Engels

The work, ‘Wage Capital and Labour’, in the book “Selected Works Volume 1” by Marx and
Engels, is not the original work of Marx. It is an alteration done by Engels. According to the
original, the worker sells his ‘labour’ to the capitalist for wages; according to the present text, he
sells his ‘labour power’. Engels gives an explanation to this and says that he owes this
explanation to the workers in order that they may see it not a case here of mere juggling of
words, but rather of one of the most important points in the whole of political economy. He says
that he owes it to the bourgeois, so that they can convince themselves how vastly superior the
uneducated workers are to the supercilious educated people.

Economists like Ricardo have advocated that the value of a commodity is determined by the
labour necessary for its production. The economists had applied this determination of value by
labour to the commodity ‘labour’. According to Engels, the value of labour cannot be
determined as the value of labour can only be expressed in terms of labour. The economists also
tried to equate the value of a commodity to its cost of production. But then, what is the cost of
production of labour? The economists tried to investigate the cost of production of the ‘worker’
in order to know the cost of production of the ‘labour’. The cost of production of the worker
consists of the quantity of the means of subsistence, or their price in money. This is the
minimum wage that the worker should get. The wage, Engel writes, is less than the value of
labour. In other words, out of all the value of labour i.e. the value left after cutting the values
which were already present before the worker started to work, the capitalist pays some to the
worker as wages, and pockets some for himself.

The man who found the way out was Karl Marx. What the economists had regarded as the cost of
production of ‘labour’ was the cost of production not of labour but of the living worker himself. Marx
was the first thoroughly to investigate the value-creating quality of labour and he discovered in so doing
that not all labour necessary for the production of a commodity adds to it a magnitude of value, which
corresponds to the quantity of labour expended.

Two things that are of our concern in studying wage labour and capital, in order for us to
understand capitalist mode of production are the relation of wage labour to capital, and the
domination of the capitalist. Wages are the sum of money paid by the capitalist for a particular
labour time. The capitalist buys the labour with money. The worker, on the other hand,
exchanged his labour power for money. Wages, therefore, are not a share of the worker in the
commodities produced by him. Wages are that part of already existing commodities with which
the capitalist buys a certain amount of productive labor-power. Consequently, labor-power is a
commodity, which its possessor, the wageworker, sells to the capitalist. Why does he sell it? It is
in order to live.

The same general laws, which regulate the price of commodities in general, naturally regulate
wages, or the price of labor-power. The price of labor-power will be determined by the cost of
production, by the labor-time necessary for production of this commodity: labor-power. What,
then, is the cost of production of labor-power? It is the cost required for the maintenance of the
laborer as a laborer, and for his education and training as a laborer. The price of his work will
therefore be determined by the price of the necessary means of subsistence.

Capital consists of raw materials, instruments of labor, and means of subsistence of all kinds,
which are employed in producing new raw materials, new instruments, and new means of
subsistence. All these components of capital are created by labor, products of labor,
accumulated labor. Accumulated labor that serves as a means to new production is capital.

What is it that takes place in the exchange between the capitalist and the wage-labor? The
laborer receives means of subsistence in exchange for his labor-power; the capitalist receives, in
exchange for his means of subsistence, labor, the productive activity of the laborer, the creative
force by which the worker not only replaces what he consumes, but also gives to the
accumulated labor a greater value than it previously possessed. Capital therefore presupposes
wage-labor; wage-labor presupposes capital. They condition each other; each brings the other
into existence.
Surplus Value:

Capitalism is a system of commodity production. In the capitalist system, producers do not

simply produce for their own needs, but capitalism involves an exchange market. Every
commodity has a use-value and an exchange value. Use-value is realized only in the process of
consumption. An object can have use-value whether or not it is a commodity. But to be a
commodity, an object must have use-value. Exchange-value on the hand refers to the value that
a product has when it is offered in exchange for other products. Exchange-value presupposes a
definite economic relation. It is inseparable from a market on which goods are exchanged.

Both exchange and use-value must be related to the amount of labour embodied in the
production of the commodity. Abstract labour is the basis of exchange value, whereas useful
labour is the basis of use-value. Labour time is the amount of time required for the production
of the commodity under normal conditions of production. The necessary labour time for
production can be empirically studied. A sudden technological improvement can reduce the
amount of labour time and hence will lead to a decrease in the value of the commodity. In other
words, for Marx, labour time determines the value of the commodity. Demand does not
determine value, but it can affect prices. It follows from the analysis of exchange value that
products exchange according to their value i.e. according to the socially necessary labour time
embodied in the production of those products.

Marx advocates that a capitalist buys labour and sells commodity. This means that labour power
itself is a commodity. Then the value of the commodity ‘labour power’ is determined by the
labour time necessary for its production. And this involves the requirements that the worker has
for his existence as a functioning organism. In other words, the worker exchanges his labour
with capital, and the price he receives is the value necessary to cover the cost of his subsistence
i.e. value of labour power.

The worker sells his labour power to the capitalist, who uses this labour power to produce a
product of greater value than the value of labour power. Whatever the worker produces above
the value of his labour power is surplus value. Surplus value is the social product that is over and
above what is required for the producers to live. The measure of value is labour time, so surplus
value is the accumulated product of the unpaid labour time of the producers. In bourgeois
society, surplus value is acquired by the capitalist in the form of profit: the capitalist owns the
means of production as Private Property, so the workers have no choice but to sell their labour-
power to the capitalists in order to live. The capitalist then owns not only the means of
production, and the workers’ labour-power, which he has bought to use in production, but the
product as well. After paying wages, the capitalist then becomes the owner of the surplus value,
over and above the value of the workers’ labour-power.

In all societies in which there is a division of labour, there is a social surplus; what is different
about bourgeois society is that surplus value takes the form of capital, and surplus value is in
fact the essence of production in capitalism.– Only productive work, i.e., work which creates
surplus value, is supported. All “unproductive labour” is eliminated.

Attempts by individual capitalists to increase their profits by introducing machinery or speeding-

up production by technique fail as soon as their competitors copy the new technique and
restore their market share. The end effect of these improvements in production may be to
increase the productivity of labour, but unless the rate of surplus value is increased
proportionately, the rate of profit will actually fall. This leads the capitalists to exploit the
workers. They are exploited not by unequal exchange in labour market, but by being made to
work more and paid less than the value of their labour power. The surplus value that is created
is kept with the capitalists as profit. Therefore, Marx equates the rate of surplus value with the
rate of exploitation. This can also be seen as the basis of class conflict in the capitalist mode of
production.

Marx describes the rate of surplus value i.e. the rate of exploitation, as the ratio between
necessary labour and surplus labour. Constant capital and variable capital are two types of
capital that are necessary for production. Constant capital i.e. capital spent on machinery, raw
materials, maintenance, is just one part of the capital outlay. Variable capital is the capital that
is spent on wages. And another way, in which the rate of surplus value can be calculated, is by
the ratio of surplus value to variable capital. Marx’s theory of capitalist development is founded
upon the nature of capitalist expropriation as set out in the theory if surplus value.

Capitalism:

In capitalism, the degree of exploitation crosses all possible human limits. A testimony to this
includes commodification of human labour, marketability of basic means and forces of
production, perpetual growth of various forms of alienation; capitalist monopoly, appropriation
of surplus value of labour, absolute dependency on market: pauperization resulting in mass
poverty and the prosperity of the few. By the virtue of economic domination, the dominant class
controls education to ensure that education offers scope for the recruitment of labour into
industry, i.e., enterprise at a lower price. By controlling religion, dominant class ensures that
ideology will bind people to the normative values, defined by the dominant class from time to
time. Controlling political apparatus, dominant class exhibits coercive control over the
subordinates, ensuring that it is mandatory for the labourer to settle down for lower wages
without any possible rebellions. Thus, Marx explains how capitalist mode of production offers
opportunity for the growth of class-based inequality in the superstructures i.e. foundation to
human sufferings, exploitation and deprivation.

Due to such exploitation, there is a gap created between the owners and the workers.
Pauperization and polarization lead to the workers realizing their true class identity, which leads
to consciousness and experience of mass poverty. Alienation plays a part in creating a class
divide in the society. As a result the proletariat are driven by the spirit of true class-
consciousness that consequently paves the way for qualitative transformation of social order,
usually through a revolution.

Marx claims that workers of the world must have to unify themselves. They must detach
themselves from the illusions of religion and the slogan of democracy. Through their collective
mobilization, they should strive for the dictatorship of proletariat, which will give rise to the
appearance of socialism, minimization of inequality, which will subsequently be transformed
into communism, referring to an egalitarian social order in the superstructure which can alone
promote human happiness, individual liberty and collective well being.
There is no real solution, according to Marx, to the problems of class and inequality in the
superstructure so long as division of labour is abolished. The move to abolish division of labour
would start as an economic movement and would subsequently turn into a political movement,
demanding radical social change and a socially egalitarian society. Only if there is economic
equality can there be achieved equality in the superstructure.

According to Marx, Capitalism is not the last stage of human history. It is to be followed by
communism and socialism. It can be inferred from his works, that the main difference between
Capitalism and Socialism-Communism is that of the degree of inequality. But, before
concentrating on what his works have to say on equality and inequality, let us first have a look at
the various reasons, rather processes that led to the development of class conflict. This in turn,
leads to economic movements, turning the demand of economic equality into a demand for
political and social equality. In short, the movement that starts as an economic movement
changes to a social movement, mainly by revolutions.

ALIENATION

Alienation, social inclusion and exclusion are the main processes that lead to class conflict.
Workers in Capitalism get alienated from production, process of production, production
environment and most importantly, the self and society. According to Marx, Alienation is a
psychic experience with an economic cause. Alienation is a consequence of Capitalism. Human
beings are potential producers. When you produce a commodity, you see a production potential
and a potential creativity. In capitalism on the other hand, the worker produces for a company,
therefore, the fruit of one’s labour becomes the private property of the entrepreneur. The
worker has no right over his production. This is what Marx terms as alienation from production.

The workers working in Capitalist structure do a mechanical kind of work, which leads their life
to become monotonous and uninteresting. According to Marx, the workers would feel like
running away from factories like they would run away from plague. Such kind of work leads to
alienation from the process of production.

In the place of work, the status of a person is determined by the position he is holding. Due to
repetitive things being discussed, there is no self or psychic satisfaction to the workers. Hence,
they get alienated from the production environment.

According to Hegel, man is a full producer while an animal is a part producer. This is so because
animas are made to work. In capitalism, man is reduced to part producer because work done is
not arising out of love for the work but for the collection of wage. This leads to decline in the
value of labour and increase in the value of commodity, as the wage received is never sufficient.
This is alienation from self and society.

SOCIAL EXCLUSION AND REVOLUTION

Once the workers have been alienated, they are forcefully excluded from the production and it’s
environment, mainly by the owners of production i.e. capitalists. Once they have been excluded,
they tend to go into self-exclusion by the way of formation of trade unions and various other
associations. This leads to a sense of belongingness and collective conscience being developed by
the workers. Through these groups and associations, they go for mobilization and movements
that have as their objective the demand for economic equality. Due to interference from the
political and other dominant spheres of society, these economic movements changed from
economic to social and political movements. The demand for economic equality comes under
the demand for political equality, which is already a part of the movement towards social
equality. The central argument that can be brought to light from the works of Marx is that the
economic sphere influences all the other spheres of society. For inequality to be done away in
society, division of labour in the economic sphere will have to be done away with. This requires
a social movement, which has its roots, according to Marx, in the economic movements arising
out of class conflicts, which are in turn the results of the exploitation in the capitalist structure.