[OPE-L:5200] state and workers'ownership and (un)productive labor

From: Gerald_A_Levy (Gerald_A_Levy@email.msn.com)
Date: Sun Mar 18 2001 - 09:42:31 EST

Re Paul B's [5193]:

> Yes of course the capitalist class is very reluctant to allow the State to
> be involved in production processes, the discipline of profit cannot be
> clearly worked out in that relation, taxation is all too easily used  in
> productive activities. Neverthless it must be indisputable that where,
> especially in Europe after WW2, the State steps in to reconstruct and
> control the finances of steel, iron, coal, railways etc  these industries
> are producing commodities for general sale and 'surpluses' were demanded
> the state of these industries... eventually the political pressures
> the legal control of the process were changed and the relationship
> transfered back to where it 'belonged'... > privatisation... to private
> shareholders.
> Surely you are not going to rely on  legal formality ? In the same way as
> 'profit' can arise in non productive circulating activities, (where a
> is made on the SV produced previously) then  surplus value can be pumped
> in  'non private' production activities...as long as were are clear that
> State acts as the collective capitalist, producing a commodity, in
> branches of industry, reluctantly and (historically) temporarily.

You raise some interesting issues which I would
like to disentangle a bit.

Let's consider first what I understand to be the
main type of state production that you refer
to. Namely, instances in Europe (and elsewhere)
following World War II when there was the
nationalization of industry. To begin with, I
agree that the labor so employed should be
considered -- in the main -- to be production
labor. Yet, labor engaged in production is not
necessarily productive of surplus value.

How are we to understand these nationalizations?
I would assert that most of these industries were
taken over by the state only under the threat of
plant closings and bankrupcy. In that case, the
state took over these industries *not to be able
to produce surplus value* but to: a) protect
the value of  the company from being prematurely
lost; b) to ensure that there wasn't a "domino
effect" whereby many other capitalists, that
depended on the demand by the firm being
nationalized or the workers employed at that firm
for sale of their output, didn't also go out of
business. Thus, at the same time the state let small
businesses go out of business they took action
when a major capitalist (and employer) threatened
bankrupcy. The object, then, of the state
acquisition was to protect the prospects for
continued capital accumulation on the national
level (in other words, to forestall a national
economic catastrophe); c) as a concession to
individual capitalists who demanded protection
*and* as a concession to workers' and trade
union demands that the state act to protect
their jobs.

It is interesting to note that in the case of Germany
many of the nationalizations were mandated by
the Allied military forces.  Thus, perhaps we
should also see this restructuring process as
part of  what became the Marshall Plan and,
relatedly, an effort to diffuse workers' militancy
and the prospects for revolutionary change.

In the case of some other countries, like France,
the influence of  Social Democratic and (mass)
Communist parties on government policy
should not be entirely discounted. Indeed, the
fear by these parties and trade union federations
(such as the CGT) that plant closings would
cause mass unemployment was a motivating
force for demands for state take-overs. Perhaps,
additionally, such action was taken because of the
fear (both by the state *and* the SD and CP
and trade union "leadership") that if there was
continued inaction then the workers themselves
would take-over and occupy the factories
(and, in fact, in some instances this occurred)
and unleash a dynamic that could  get "out of

But, I think the main point to remember is that
there was no immediate anticipation by the state
or others that such plants could generate a
surplus. Indeed, it was anticipated that they
would generate a loss. And it was, as you
suggest, only after the state-owned enterprises
had demonstrated that they could receive a
profit (a share of the total surplus value) that
there were demands for privatization.

In other instances, the motivation and dynamics
of state ownership may be diferent. E.g. we
can agree that there are, in many countries, both
privately-owned and state-owned schools and
hospitals.  In some cases, the state-owned
schools and hospitals used to be privately-
owned. In some cases, state-owned schools
and hospitals have become privatized. The
same use-values are produced at both kinds
of schools and hospitals. The labor employed
at both kinds of schools and hospitals is, in the
main, engaged in production. But,  in the
state-owned schools and hospitals wage-labor is
exchanged against revenues rather than capital,
i.e. it is not capitalistically employed.  From my
perspective, then, it is not labor which is
productive of surplus value.

Of course, one could note that there is a price
in many cases attached to the services provided
by these state-owned hospitals and schools.
E.g. in the US most public colleges have tuitions
(although there were *huge* social struggles, as
in the case of SUNY and CUNY, over the
question of whether there would continue to be
free tuition -- and open admissions -- or whether
there would be unfree tuition -- and "standards"
conccerning admissions). Yet, even where students
have to pay a tuition at these schools it is
significantly less than the tuition at capitalist
institutions of higher learning.  I believe that this
is a reflection of the fact that although goods
are for sale here, there isn't surplus value
production. Rather, those institutions are not
self-sufficient and have to rely heavily on revenues
provided by the state.

Another kind of ownership possible under
capitalism, generally under exceptional
circumstances, is workers-ownership. Do the
workers at those enterprises produce
surplus-value? (Gil: are you listening?).

Although I might be accused of being "formal"
(Rakesh, I believe, once wrote in connection
with a thread on whether slave labor was
productive of surplus value, that I was "being
formalistic to the point of tears" -- or words to
that effect), I would say, "No".  Yes, the
worker-owners can produce goods which are
sold on the market and come to be treated as
if they were commodities. And, indeed, they
do produce commodities if you believe that
a commodity is any object which has both a
use-value and an exchange-value (i.e. a product
with a use-value that was produced in order
to be sold).  Yet, from my "formalistic"
perspective, unless labor is capitalistically-
employed then it can not produce surplus value.

Gil might counter with some quotes from Volume
3. Fair enough. Yet, the question is what is the
most consistent way of conceiving of productive

Also, I will note that many of the instances of
workers' ownership only occurred after the
firm announced that they would close a plant.
The union or workers then bought the plant. In
some of these cases, the very first thing that
they did was to lay-off some of the other
worker-owners. They also found, relatedly,
that often the means of production were obsolete
and that they could not compete with capitalist
firms who employed more advanced technologies.
In some cases (e.g. the former Hyatt Roller
Bearing plant in Clark, NJ) the workers then
discovered that they had bought a "pig in a
poke" (i.e. that they had been swindled
by their former employer into investing their life savings and pensions) and
ultimately had to
close the plants and declare bankrupcy.

Paul continues:

> You won't recall Marx refering to the State and production, but you will
> recall Engels consideration of the developing relation between State and
> the economy.... history is dynamic.. we have to understand how the social
> form of capital takes on  historical guises, fights against its own
> contradictions in every way. I don't think we can simply 'textualise'
> contemporary reality. This is very important for political analysis

Agreed ... although it is easier said than done.

> ... is
> the State a capitalist State?


>  If it is it won't (without fetishising it)
> want to create unproductive relations, to abandon its guardianship  of
> private property of profit making.

Unproductive relations by the state can benefit
profit-making. E.g.  the military: workers who are
employed by the military can help to bring
about  a redistribution of global surplus value to
the benefit of capitalists within that nation.

It is *also* true that while the state is a capitalist
state, state policies can not always be
comprehended by the logic of capital
accumulation. E.g. under bourgeois democracy
it is possible for the working-class to win (limited)
reforms that are opposed by capitalists. Marx was
certainly aware of this and supported many of
those reform movements.

> I suspect a certain formalism in the approach that says the modern
> imperialist state can be understood by refering to Marx's assessment of
> predecessors  economic view of  quasi feudal or early modern States.

Did I mention "quasi-feudal" or "early modern

In solidarity, Jerry

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