[OPE-L:2553] Re: a priorism - definition of capitalism

Paul Cockshott (wpc@cs.strath.ac.uk)
Fri, 21 Jun 1996 02:56:10 -0700 (PDT)

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Andrew :
>We are discussing whether the "USSR" was a capitalist society. Paul's
> a prioristic method of discussing this is clear from the following:
>"capitalism ... is characterised by ... private appropriation."

Paul C:
I was merely echoing a long established marxist tradition, which,
well before the Soviet Union existed described described already
existing capitalism as having private appropriate and social production.

I dont see that the tradition was apriorist to do this, they were
describing what was actually happening in commodity producing societies.
I am not personally familiar with the history of the state-capitalist
theories to which Andrew subscribes, but I suspect that they were
formulated after the Russian revolution, and must in the process have
involved some modification in what had until then been taken as the
characteristic features of capitalism.

>"We have to explain the behaviour of the whole system as a result of the
> interaction of a mass of unco-ordinated private firms."
>These statements either assume exactly what they need to prove, or are
> empty tautology ("Capitalism is private because that's how I define it.")

Paul C:
We have observable to us economies that are characterised by integration
via the 'law of value', regulation of social labour allocation in response
to deviations of prices from values - the anarchy of the market.
This is the sort of economic system that Marx analysed and which,
by common consent economists, both Marxian and non-marxian have
labelled capitalist. One may change its title and call it 'free enterprise'
or 'market economy' to suit ones ideological predilictions, but
everyone knows what is really being refered to here.

We also had, subsequent to about 1930 and up to about 1990, examples of
economies in which the regulation of social labour allocation occured
not in response to the 'law of value' as described above, but according
to a politically determined state plan. These have generally be called
socialist economies, but again depending upon the ideological predilictions
of the author they have also been called centrally planned, or state
capitalist economies. Again, making allowances for the speakers ideological
dialect, one has no difficulty in telling what is really being refered
to. Nobody will assume that when Andrew talks about the state-capitalist
economies that he refers to Switzerland.

In practice all theorists treat these two forms of economies as distinct
categories. Most would agree that one could group these different categories
into some higher order category - socialised production economies, industrial
economies, or in Andrews case 'capitalist' economies. But the fact that
Andrew choses to use the word 'capitalist' to label the superset, can not
disguise the fact that this use involves a mutation in the meaning of
the word. We are of course free to follow our hearts and use such language
as gives us satisfaction, so long as in doing this we neither change the
real world, nor are able to constrain others to use them in the same way
as we do. There is no real point in arguing over the mere use of words.

So long as it is clear that when I use the word capitalism, I am using
it in the old conventional sense, and that Andrew is using it in a more
specialist sense there need not be any dispute.
What is in dispute however, is how the economies that I label capitalist,
and which from his point of view are capitalist but not state capitalist,
actually work.

>Paul burdens me with inverting the real causality. No, I was not giving a
> *causal* explanation. Paul may think that only causal explanations are
> valid. I do not. "Production for production's sake" IMO renders the
>overall tendency of capitalist society more intelligible than it would be
> without this category, and contributes to an explanation, in this sense, of
> capitalism's law of motion.

Paul C:
I am definitely of the opinion that only causal explanations are valid.
All else is story telling for the edification of the soul.

>Of course the "driving motive of capitalist society" exists only in the
> mind. The same is true of "capitalist society," "capitalist," "firm,"
> etc. SHOW me "a firm," Paul. You can't.

Paul C:
Cable and Wireless PLC.


>It is self-evident to me that firms need to accumulate, or go under. Paul
> asks for evidence. The best evidence is the concentration and centralization
> of capital. It is indirect evidence, but it is very, very strong. Along
> with Marx, I understand state-capitalism to be part of this concentration and
> centralization. In Ch. 25 of _Capital_ he wrote that the limit to centrali-
>zation in a given capitalist society wouldn't be reasched until all capital
> was in the hands of one single capitalist or one single capitalist company.
>Paul's empirical test is too crude for me. First, I don't know what he means
> by "net accumulation." How, for instance, are you counting business taxes?
> Wages for unproductive labor? Second, what do you mean by "capitalist
> consumption"? Is it the same as "unproductive consumption"? But third, and
> most important, the test is invalid because, as I pointed out, the capitalist
> drive to accumulation is self-contradictory, self-limiting, which will
> likely bias accumulation rates downward.

Paul C:
I am not willing to accept truths that are self evident, since one can
produce other contradictory self evident truths. I could say that it is
self evident that the main purpose of firms is to pay high dividends to
their owners, and that any firm that fails to do this will see its share
price fall and be taken over. In this case I could likewise adduce the
concentration of capital to my argument - concentration occurs when
firms fail to meet their first duty of paying dividends.

The question at issue is whether the assertion that capitalism is
characterised by production for productions sake is a more accurate
characterisation than the alternative formulation that it is production
for the sake of profit. My belief is that capitalists as a class are
concerned with obtaining a large and secure income to enable them to
enjoy a life of luxury. If in so doing, they have occasion to organise
production, then that is an inconvenience to be endured, but the bottom
line is the bottom line. In the absence of political intervention by
the state the tendancy of capitalists as a class is to consume their
surplus, accumulate as little as possible and 'make their assets sweat'.
I have been driven to this conclusion by the perusal of almost a century
and a half of accumulation statistics for the UK economy, which indicate
that with the exception of the period 1948 to 1978, they have unproductively
consumed the overwhelmingly greater part of the surplus value that
they obtained.

I think that if a drive to accumulate turns out to be so weak, whether this
is because it is self-contradictory or self-limiting or some other cause,
as to be the exception rather than the rule, then the theory that capitalism
is production for the same of production must fall. If one holds to
it still, then one has formulated it so weakly that it is almost unfalsifiable.

>Marx's reproduction schema are not ONLY a demonstration that expanded
> reproduction is possible. They have another, in my view more important,
> theoretical significance. They show the DIRECTION that expanded reproduction
> under capitalism must take, if it occurs.

Paul C:
There is firstly the question of when and whether it occurs,
second there is the question of the relative proportions of surplus
accumulated and consumed, thirdly there is the issue of the rate of
growth of the labour force, fourthly there is the issue of the changes
in the rate of surplus value as accumulation occurs, fifthly the question
of the influence of interest rates on accumulation,....
In other words there are a great many unbound variables, these constitute
real topics of investigation for OPE, in the sense of genuinely unsolved

Paul Cockshott