Mr. Henderson, president of the committee of Blackburn, wrote with reference to this to factory inspector Redgrave, that in his entire experience in the course of this period of suffering and misery nothing had struck him more emphatically or given him so much pleasure as the serene willingness with which the unemployed laborers of his district accepted the work offered to them by the city council of Blackburn pursuant to the Public Works Act. A greater contrast could hardly be imagined than that between the cotton sj^inner, who formerly worked as a skilled man in the factory, and the daylaborer, who now works in a depth of 1-i or 18 feet on a drainage canal. (They earned thereby about 4 to 12 sh. per week, according to the size of their families, and this last enormous amount had to provide sometimes for a family of eight. The gentlemen of the bourgeoisie derived a double profit from this. In the first place, they secured money for the improvement of their smoky and neglected cities at exceptionally low interest. In the second place, they paid wages to the laborers at a scale far below the ordinary.) Mr. Henderson thinks that this ready willingness on the part of the laborers to accept the offered employment implied great self-denial and consideration, and deserved all honor, since they were accustomed to an almost tropical temperature, to work in which skill and accuracy counted for more than muscular strength, and to wages which were double, or sometimes treble, of what they could earn now. In Blackburn the men were tried at all possible kinds of labor in the open air. They dug through a stiff and heavy clay soil to a considerable depth, they did drainage work, broke stones, built roads, made excavations i6o Capitalist Production. * for street canals to a depth of 14, 16, and sometimes 20 feet. Frequently they stood in mud and water from 10 to 12 inches deep, and tliey were exposed to a climate whose wet cold was not exceeded, or perhaps not equalled, in any other district of England. (Pages 91 and 92.) The attitude of the laborers has been almost faultless, their willingness to accept work in the open air and to get along on it. (Page 69.)
186-4. April. Occasionally comjDlaints about lack of laborers are heard in various districts, especially in certain branches, for instance weaving. But these complaints are due as much to the low wages which the laborers may earn in consequence of the bad kinds of yarn as to an actual scarcity of laborers in this particular line. Numerous disputes over wages took place during the preceding month between some manufacturers and their laborers. The inspector regrets that strikes occurred far too frequently. The effect of the Public Works Act is now resented by the manufacturers as a competition, and as a result the local committee of Bacup has suspended its activity. For although all the factories are not yet running, there has already been a lack of laborers. (Factory Report, April, 1864, pages 9 and 10.) It was indeed high time for the manufacturers to act. In consequence of the Public Works Act the demand for laborers grew so much that many a factory hand was making 4 to 5 shillings per day in the quarries of Bacup. And so the public works were gradually suspended; this new edition of the Ateliers nationeaux of 1848, which had this time been opened in the interests of the bourgeoisie.
Trying it on the Dog.
Although the very reduced wages (of the fully employed), the actual earnings of the laborers in the different factories, have been given, it does not follow that they earn the same amount week after week. The laborers are exposed to great fluctuations at this place, in consequence of the continual experiments made by the manufacturers with different kinds and proportions of cotton and waste in the same factory. The " Mixtures," as they are called, are frequently changed, and the The Effect of Fluctuations in Price. i6i earnings of the laborers rise and fall with the quality of cotton mixtures. At times they earned only 15% of their former wages, and in one or a couple of weeks wages fell to 50 or 00%. Inspector Redgrave, who makes this report, then pro ceeds to figures of wages selected from practical life. The following examples may suffice: A, weaver, family of 6 persons, employed 4 days in the week, G sh. 8.5 d.; B, twister, 4.5 days per week, 6 sh.; C, weaver, family of 4, 5 days per week, 5 sh. 1 d.; D, slubber, family of 6, employed 4 days per week, 7 sh. 10 d.; E, weaver, family of 7, employed 3 days, 5 sh., etc. Redgrave continues in substance: These data deserve attention, for they prove that labor would become a misfortune in some faiuilies, since it reduces not only the earnings, but depresses them so low that they become totally insufficient to satisfy anything but a small part of a family's absolute necessities, unless additional assistance Avere given in cases where the earnings of a family do not reach the amount which would be granted to them if all of them were unemployed. (Factory Reports, October, 1863, In no week since June 5, 1863, has the average total employment of all laborers been more than 7 hours and some minutes. (Page 121.)
From the beginning of the crisis to March 23, 1863, nearly three million pounds sterling were exjDended by the poor boards, the central committee of charity, and the London Mansion House committee. (Page 13.)
In one district, in which perhaps the finest yarn is spun, the spinners suffer an indirect reduction of wages of 15% as a result of passing from Sea Island to Egyptian cotton.
In one extended district, in which cotton waste is used in large quantities as an admixture to Indian cotton, the spinners have had their wages reduced by 5%, and lost besides from 20 to 30% by working up Surat and waste. The weavers have dropped from four looms to two. In 1860 they made 5 sh. 7 d. on each loom, but in 1863 only 3 sh. 4 d. The fines, which amounted to from 3 to 0 d. per spinner on American cotton, now run as hio;h as 1 sh. to 3 sh. 6 d. In one 1 62 Capitalist Production.
district, in which Egyptian cotton was used, mixed with East-Indian, the average earnings of the mule sj^inners in 1860 was from 18 to 25 sh., while it is only from 10 to 18 sh. now. This not exclusively due to deteriorated cotton, but also to the decreased speed of the mule, in order to give to tlie yarn a stronger twist, for which extra payment according to the wage scale would have been made in ordinary times. (Pages 43, 44, 45-50.) Although East-Indian cotton may have been worked here and there at a profit for the manufacturers, the wage list on page 53 shows that the laborers suffer from it, compared with 1861. If the use of Surat becomes a settled fact, the laborers would demand the same wages as in 1857. Eut this would seriously affect the profits of the manufacturers, unless it would be balanced by the price of either the cotton or the products. (Page 105.)
House-Rent. The house-rent of the laborers living in cottages belonging to the manufacturers, is frequently deducted from their wages, even if only short time is worked. Nevertheless the value of these buildings has fallen, and the cottages are now from 25 to 50% cheaper than formerly. A cottage which formerly rented from 3 sh. 6 d. per week, may now be had for 2 sh. 4d., and sometimes for less. (Page Emigration. The employers were, of course, opposed to the emigration of the laborers, in the first place because they wished, in the expectation of better times in the cotton industry, to keep the means at hand for the profitable operation of their factories. In the second place some employers are owners of cottages in which their employes are to live, and at least some of them calculate without fail to collect at least a portion of the rent due them. (Page 96.)
Mr. Bemall Osborne says in a speech to his parliamentary constituents, on October 22, 1864, that the laborers of Lancashire had behaved like ancient stoic philosophers. Perhaps they acted like sheep?
Additional Remarks. 163 CHAPTER VII.
ADDITIONAL KEMARKS.
Take it, in accordance with, the assumption on which this section is based, that the mass of profit appropriated in any particular sphere of production is equal to the sum of the surplus-values produced by the total capital invested in this sphere. Nevertheless the bourgeois will not consider his profit as identical with the surplus-value, that is to say, with unpaid surplus-labor. And he will do so, for the following reasons.
1) He forgets the process of production in the process of circulation. He is of the opinion that surplus-value is made by his realisation on the value of commodities, which includes realisation on their surplus-value. [There is a blank at this place, indicating that Marx intended to dwell in detail on this point. — F. E.]
2) Assuming a uniform degree of exploitation, we have seen that the rate of profit may differ considerably according to the relative cheapness or deamess of raw materials and the experience of the buyer, according to the relative productivity, efficacy, and cheapness of the machinery employed, according to the greater or lesser perfection of the general equipment of the various stages of the productive process, the simplicity and effectiveness of the management, etc.; all this without reference to any modifications due to the credit-system, to the mutual cheating of the capitalists among themselves, to any favorable choice of tlie market. In short, given the surplusvalue for a certain capital, it depends still very much on the individual business ability of the capitalist, or of his managers and salesmen, whether this same surplus-value realises a greater or smaller rate of profit and thus yields a greater or smaller mass of profit. The same surplus-value of 1,000 164 Capitalist Production.
p.st., a product of 1,000 p.st. of wages, may be calculated in the business of A on 9,000 p.st., in the business of B on 11,000 p.st. of constant capital. In the case of A we have then p' = 1^, or 10%. In the case of B we have p' =j^, or 8^^. The total capital produces relatively more profit in the business of A than in that of B, although the variable capital advanced in either case is 1,000 p.st., and the surplusvalue produced by it likewise 1,000 p.st., so that there is in both cases the same degree of exploitation of the same number of laborers. This difference in the materialisation of the same mass of surplus-value, or the difference in the rates of profit, may also be due to other causes. Still, it may be due wholly to a difference in business ability in both establishments. And this fact leads the capitalist to the conviction that his profits are due, not to the exploitation of labor, but at least, in part, to other circumstances independent of that exploitation, particularly to his individual activity.
The analyses of this part of the work demonstrate the er* roneousness of the view (Rodbertus) according to which (in distinction from ground-rent, in the case of which the area of real-estate is said to remain the same and yet to produce a higher rent) a change in the magnitude of a certain capital is said to have no influence on the proportion of profit to capital, and thus on the rate of profit, on the assumption that the mass of capital, on which profits are calculated, grows simultaneously with the mass of profits, and vice versa.
This is true only in two cases. In the first place, it is true, assuming all other circumstances, especially the rate of surplus-value, to remain unchanged, if there is a change in the value of that commodity which is a money-commodity. (The same occurs in the case of a merely nominal change of value, the rise or fall of mere tokens of value while other circumstances remain the same.) Take it that the total capital amounts to 100 p.st, with a profit of 20 p.st., so that the rate of profit is 20%. Now, if gold rises or falls by 50%, the same capital, in the first eventuality, will be worth 150 p.st., which was previously worth only 100 p.st., and the profit Additional Remarks. 165 will be worth 30 p.st., that is to say, it will be worth that much in money instead of 20 p.st., as before. In the second eventuality, the capital of 100 p.st, will be worth only 50 p.st., and the profit will be represented by the value of 10 p.st. But in either case 150: 30 = 50": 10 = 100: 20 = 20%. But in all these cases there would have been no actual change in the magnitude of capital-value, but only in the money-expression of the same value and the same surplusvalue. For this reason -^, or the rate of profit, could not be affected.
The second case is that in which an actual change of magnitude takes place in the value, but without being accompanied by a change in the proportion of v to c, in other words, when the rate of surplus-value remains the same and the proportion of the variable capital invested in labor-power (considered as an index of the amount of labor-power set in motion) to the constant capital invested in means of production remains the same. Under these circumstances, we may have C, or nC, or •^, for instance 1,000, or 2,000, or 500. If the rate of profit is 20%, the profit will be 200 in the first case, 400 in the second, and 100 in the third. But 200: 1,000 = 400: 2,000 = 100: 500 = 20%, that is to say the rate of profit remains unchanged, because the composition of capital remains the same and is not effected by its change of magnitude. An increase or decrease in the mass of profit shows therefore merely an increase or decrease in the magnitude of the invested capital.
In the first case, then, there is but seemingly a change in the magnitude of the employed capital, while in the second case there is an actual change of magnitude, but no change in the organic composition of the capital, that is to say, in the relative proportions of the variable and constant portions. With the exception of these two cases, a change in the magnitude of the employed capital is either the result of a preceding change of value in one of the components of capital, and therefore of a change in the relative magnitudes of these components (unless the surplus-value itself varies with the variable capital); or, this change of magnitude (for instance in the 1 66 Capitalist Production.
case of enterprises on a large scale, the introduction of new machinery, etc.) is the caiise of a change in the relative magnitudes of the organic components of capital. In all these cases, other circumstances remaining unchanged, a change in the magnitude of the employed capital must he accompanied simultaneously by a change in the rate of profit.
An increase in the rate of profit is always due to a relative or absolute increase of the surplus-value in proportion to its cost of production, for instance to the advanced total capital, or to a decrease in the difference between tlie rate of profit and the rate of surplus-value.
Fluctuations in the rate of profit, independently of changes in the organic components of capital, or of the absolute magnitude of the capital, may occur through a rise or fall of the value of the advanced capital, whether it be fixed or circulating, caused by a prolongation or reduction of the working time required for its reproduction, this change in the worl^ing time taking place independently of already existing capital.
The value of every commodity, including the commodities of which capital consists, is determined, not by the necessary labor-time contained in it individually, but by the social labortime necessary for its reproduction. This reproduction may take place under aggravating or under propitious circumstances, which differ from the conditions of original production. If it takes under altered conditions double the time, or half as much time, to reproduce the same material capital, and if the value of money remained unchanged, then a capital formerly worth 100 p.st. would be worth 200 p.st. or 50 p.st. If this appreciation or depreciation were to affect all parts of capital uniformly, then the profit would also be expressed correspondingly in double, or half, the amount of money. But if appreciation or depreciation imply a change in the organic composition of capital, if they imply a raising or lowering of the proportion between the variable and constant portions of capital, then the rate of profit, other circumstances remaining the same, will grow with a relatively gi'owing, and fall with a relatively falling, variable capital If only the Additional Remarks. 167 money- value of the advanced capital rises or falls (in consequence of a change in the valuation of money) then the moneyvalue of the surplus-value rises or falls in the same proportion. The rate of profit remains unchanged.
PART II.
COXVERSIOX OF PROFIT IXTO AVERAGE PROFIT.
CHAPTER VIII.
DIFFEKENT COMPOSITION OF CAPITALS IN DIFFERENT LINES OF PRODUCTION AND RESULTING DIFFERENCES IN THE RATES OF PROFIT.
In the preceding part we demonstrated among other things tliat the rate of profit may vary, may rise or fall, while the rate of surplus-value remains the same. In the present chapter we assume that the intensity of exploitation, and therefore the rate of surplus-value and the length of the working day, are the same in all spheres of production into w^hich the social labor of a certain country is divided. Adam Smith has already shown explicitly that many differences in the exploitation of labor in different spheres of production balance one another by many actual causes, or causes regarded as such by prevailing prejudices, so that they are mere evanescent distinctions and are of no moment in this calculation. Other differences, for instance those in the scale of wages, rest largely on the difference between simple and complicated labor, mentioned in the beginning of volume I, which do not affect the intensity of exploitation in the different spheres of production, although they render the conditions of the labor"^rs in those spheres very unequal. For instance, if the labor of a goldsmith is paid better than that of a day-laborer, the surplus-labor of the goldsmith produces correspondingly more surplus-value than that of the day-laborer. And while the compensation of wages and working days, and thereby of the rates of surplus-value, between different spheres of production, or even different investments of capital in the same Different Composition of Capitals. 169 sphere of production, is checked bj many local obstacles, it is nevertheless accomplished at an increasing degree with the advance of capitalist production and the subordination of all economic conditions under this mode of production. The study of such frictions, while quite important for any special work on wages, may be dispensed with as being accidental and unessential in a general analysis of capitalist production. In such a general analysis it is always assumed that the actual conditions correspond to the terms used to express them, or, in otlier words, that actual conditions are represented only to the extent that they are typical of their own case.
The difference in the rates of surplus-value in differeL<t countries, and consequently in the degree of national exploitation of, labor, is immaterial for our present analysis. Eor we desire to analyse precisely the way in which a general rate of profit is brought about in a certain country. It is evident, however, that a comparison of the various national rates of profit requires but a collation of previous analyses with that which is to follow. First consider the differences in the national rates of surplus-value, then compare on this basis the differences in the national rates of profit. Those differences which are not due to differences in the national rates of surplus-value, must be due to circumstances in which the surplus-value is assumed to be universally the same, constant, as it is in the analysis of this chapter.
We demonstrated in the preceding chapter that, assuming the rate of surplus-value to be constant, the rate of profit may rise or fall in consequence of circumstances which raise or lower the value of one or the other parts of constant capital, and so affect the proportion between the variable and constant components of capital in general. We observed, furthermore, that circumstances which prolong or reduce the time of turnover of a certain capital may also influence the rate of profit in a similar manner. Since the mass of profits is identical with the mass of surplus-value, the surplus-value itself, it was also seen that the mass of profits, in distinction from the rate of profits, was not touched by the aforementioned fluctuations "ii value. These fluctuations modified merely the rate through I70 Capitalist Production.
vTliicli a certain surplus-value, and therefore a profit of a given magnitude, express themselves, in other words, they indicate the relative magnitude of surplus-value, or profits, as comj^ared with the magnitude of the advanced capital. To the extent that capital was released or tied up by such fluctuations of value, it was not only the rate of profit, but the profit itself, which could be affected by this indirect route. However, this always applied only to such capital as was already engaged, not to new investments about to be made. Besides, the increase or reduction of profit always depended on the extent to which the same capital could set in motion more or less labor in consequence of such fluctuations of value, in other words, the extent to which the same capital, with the same rate of surplus-value, could obtain a larger or smaller amount of surplus-value. So far from contradicting the general rule, or being an exception from it, this seeming exception was really but a special case in the application of the general rule.
It was seen in the preceding part, that the rate of profit varied, when the degree of exploitation was constant while the value of the component parts of constant capital, and the time of turn-over of caj)ital, changed. The obvious conclusion from this was that the rates of profit of different spheres of production existing simultaneously side by side had to differ, when, other circumstances remaining unchanged, the time of turn-over of the invested capitals differed, or when the proportions of the values of the organic components of tliese capitals were different in the different lines of production. That which we previously regarded as changes occurring successively in the same capital will now be considered as simultaneous differences of contemporaneous investments of capital in different spheres of production.
Under these circumstances we shall have to analyse: 1) The differences in the organic composition of capitals. 2) The differences in their times of turn-over.
The natural premise in this entire analysis is that, in speaking of the composition, or of the turn-over, of a capital in a certain line of production, we always mean the aver- Different Composition of Capitals. lyi age normal proportions of the capital invested in this line, or, more generally, of the average of the total capital invested in this sphere, not of the temporary differences of the individual capitals in it.
Since our assumption is, furthermore, that the rate of surplus-value and the working day are constant, and since this assumption implies also the constancy of wages, it follows that a certain quantity of variable capital expresses a definite quantity of exploited labor-power and therefore a definite quantity of materialised labor. In other words, if 100 p.st. represent the weekly wages of 100 laborers, indicating 100 actual labor-powers, then n times 100 p.st. indicates the laborpowers of n times 100 laborers, and ^^ p.st. those of ~ laborers. The variable capital serves here, as is always the case when the wages are given, as an index of the amount of labor set in motion by a definite total capital. Differences in the magnitude of the employed variable capitals serve, therefore, as indices of the differences in the amount of laborpower set in motion. If 100 p.st. indicate 100 laborers per week, representing 6,000 working hours, if the weekly working time is 60 hours, then 200 p.st. indicate 12,000, and 50 p.st. indicate 3,000 working hours.
By the composition of capital we mean, as we have stated in volume I, the proportions of its active and passive parts, of variable and constant capital. Two proportions require consideration under this heading. They are not equally important, although they may produce the same effects under certain circumstances.
The first proportion rests on a technical basis, and must be considered as existing at a certain stage of development of the productive forces. A definite quantity of labor-power, represented by a definite number of laborers, is required for the purpose of producing a definite quantity of products, for instance in one day, and thereby to consume productively, by setting in motion, a definite quantity of means of production, machinery, raw materials, etc. A definite number of laborers corresponds to a definite quantity of means of production, so that a definite quantity of living labor corresponds 1^2 Capitalist Production.
to a definite quantity of materialised labor in means of production. This proportion differs a great deal in different spheres of production, and frequently even in different branches of one and the same industry. On the other hand, it may occasionally be entirely or approximately the same in widely separated lines of industry.
This proportion forms the technical composition of capital and is the primary basis of its organic composition.
However, it is possible that this first proportion may bs the same in different lines of industry, provided that the variable capital is merely an index of labor-power, and the constant caj^ital merely an index of the mass of means of production set in motion by the labor-power. For instance, certain work in copper and iron may be conditioned on the same proportional composition between labor-power and the mass of means of production. But since copper is more expensive than iron, the proportion of value between variable and constant capital may be different in either case^ and then the composition of the value of the total capitals is, of course, likewise different. The difference between the technical couiposition and the composition of values is manifested by earh branch of industry by tlie fact that the proportion of ti.e values of the two parts of capital may vary while the technical composition is constant, and the proportion of values may remain the same while the technical composition varies. This last eventuality will, of course, be possible only if the change in the proportion of the employed masses of means of production and labor-power is compensated by an opposite change in their values.
The composition of the values of capital, which is determined by, and reflects, its technical composition, is called the organic composition of capital.^^ We assume, then, that the variable capital is the index of a definite quantity of laborers, or of labor-power, or a definite quantity of living labor set in motion. We saw in the preced- *• The above is briefly developed in the third edition of volume I, in the beginning of chapter XXV. Since the two first editions did not contain this passage, it was so much more necessary to repeat it at this place. — F. E.
i Different Composition of Capitals. 173 ing i3art that a change in the magnitude of the value of variable capital might eventually indicate nothing but a higher or lower price of the same mass of labor. But here, where the rate of surplus-value and the working day have been assumed to be constant, and the wages for a definite working time are given, this is out of the question. On the other hand, a difference in the magnitude of the constant capital may likewise be an index of a change in the mass of means of production set in. motion by a definite quantity of labor-power. Still, it may also be due to a difference in value between the means of production set in motion in one sphere and those of another. Both points of view must be considered here.
Finally, the following essential facts must be taken into account: Take it that 100 p.st. are the weekly wages of 100 laborers. Take it that the working hours are 60 per week. Take it, furthermore, that the rate of surplus-value is 100%. In that case, the laborers work.30 of the 60 hours for themselves, and 30 hours gratis for the capitalist. In fact, those 100 p.st. of wages represent only 30 working hours of those 100 laborers, or a total of 3,000 working hours, while the other 3,000 hours worked by the laborers are incorporated in the 100 p.st. of surplus-value, or as profit, pocketed by the capitalist. Although the wages of 100 p.st. do not express the value in which the weekly labor of those 100 laborers is materialised, still they indicate (since the length of the working day and the rate of surplus-value are given) that this capital set in motion 100 laborers for 6,000 working hours. The capital of 100 p.st. indicates this, first, because it indicates the number of laborers set in motion, since one pound sterling stands for one laborer per week, and 100 p.st. for 100 laborers per week; and in the second place, because every laborer set in motion performs twice the work for which his wages pay, at the given rate of surplus-value of 100%, so that one pound sterling, his wages, the expression of half a week of labor, actually set in motion one whole week's labor, and in the same way 100 p.st., although they pay only for 50 weeks of labor, set in motion 100 weeks of labor. There is, then, an essen- 174 Capitalist Production.
tial difference between variable capital so far as its value, invested as a wages-capital, represents a certain sum of wages, a definite quantity of materialised labor, and variable capital so far as its value is a mere index of the quantity of living labor set in motion by it. This last-named labor is always greater than that incorporated in the variable capital, and is, therefore, represented by a greater value than that of the variable capital. This greater value is determined on one hand by the number of laborers set in motion by the variable capital, and on the other by the quantity of surplus-labor performed by them.
This mode of looking upon variable capital leads to the following conclusions: