Primitive accumulation of capital

In Marxist economics and preceding theories,[1] the problem of primitive accumulation (also called previous accumulation, original accumulation) of capital concerns the origin of capital, and therefore of how class distinctions between possessors and non-possessors came to be.

Adam Smith's account of primitive-original accumulation depicted a peaceful process, in which some workers laboured more diligently than others and gradually built up wealth, eventually leaving the less diligent workers to accept living wages for their labour.[2] Karl Marx rejected this explanation as "childishness," instead stating that, in the words of David Harvey, primitive accumulation "entailed taking land, say, enclosing it, and expelling a resident population to create a landless proletariat, and then releasing the land into the privatised mainstream of capital accumulation".[3] This would be accomplished through violence, war, enslavement, and colonialism.

Naming and translations

The concept was initially called in different ways, and the expression of an "accumulation" which is at the origin of capitalism, began to appear with Adam Smith.[4] Smith, in his English language The Wealth of Nations spoke of a previous accumulation, although he never actually refers to accumulation as previous accumulation in "The Wealth of Nations";[5] Karl Marx, in the German language Das Kapital, reprised Smith's expression, by translating it to German as ursprünglich ("original, initial"); Marx's translators, in turn, rendered it into English as primitive.[1] James Steuart, with his 1767 work, is considered by some scholars as the greatest classical theorist of primitive accumulation.[6]

The myths of political economy

In disinterring the origins of capital, Marx felt the need to dispel what he felt were religious myths and fairy-tales about the origins of capitalism. Marx wrote:

"This primitive accumulation plays in political economy about the same part as original sin in theology. Adam bit the apple, and thereupon sin fell on the human race. Its origin is supposed to be explained when it is told as an anecdote of the past. In times long gone-by there were two sorts of people; one, the diligent, intelligent, and, above all, frugal elite; the other, lazy rascals, spending their substance, and more, in riotous living. (...) Thus it came to pass that the former sort accumulated wealth, and the latter sort had at last nothing to sell except their own skins. And from this original sin dates the poverty of the great majority that, despite all its labour, has up to now nothing to sell but itself, and the wealth of the few that increases constantly although they have long ceased to work. Such childishness is every day preached to us in the defence of property."

What has to be explained is how the capitalist relations of production are historically established. In other words, how it comes about that means of production get to be privately owned and traded in, and how the capitalists can find workers on the labor market ready and willing to work for them, because they have no other means of livelihood; also referred to as the "Reserve Army of Labor."

The link between primitive accumulation and colonialism

At the same time as local obstacles to investment in manufactures are being overcome, and a unified national market is developing with a nationalist ideology, Marx sees a strong impulse to business development coming from world trade:

The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the aboriginal population, the beginning of the conquest and looting of the East Indies, the turning of Africa into a warren for the commercial hunting of black-skins, signaled the rosy dawn of the era of capitalist production. These idyllic proceedings are the chief moments of primitive accumulation. On their heels treads the commercial war of the European nations, with the globe for a theatre. It begins with the revolt of the Netherlands from Spain, assumes giant dimensions in England's Anti-Jacobin War, and is still going on in the opium wars against China, &c. The different moments of primitive accumulation distribute themselves now, more or less in chronological order, particularly over Spain, Portugal, Holland, France, and England. In England at the end of the 17th century, they arrive at a systematical combination, embracing the colonies, the national debt, the modern mode of taxation, and the protectionist system. These methods depend in part on brute force, e.g., the colonial system. But, they all employ the power of the state, the concentrated and organized force of society, to hasten, hot-house fashion, the process of transformation of the feudal mode of production into the capitalist mode, and to shorten the transition. Force is the midwife of every old society pregnant with a new one. It is itself an economic power.

— Capital, Volume I, chapter 31, emphasis added.[7]

Primitive accumulation and privatization

According to Marx, the whole purpose of primitive accumulation is to privatize the means of production, so that the exploiting owners can make money from the surplus labour of those who, lacking other means, must work for them.

Marx says that primitive accumulation means the expropriation of the direct producers, and more specifically "the dissolution of private property based on the labor of its owner... Self-earned private property, that is based, so to say, on the fusing together of the isolated, independent laboring-individual with the conditions of his labor, is supplanted by capitalistic private property, which rests on exploitation of the nominally free labor of others, i.e., on wage-labor" (emphasis added).[8]

The social relations of capitalism

In the last chapter of Capital, Volume I, Marx described the social conditions he thought necessary for capitalism with a comment about Edward Gibbon Wakefield's theory of colonization:

Wakefield discovered that in the Colonies, property in money, means of subsistence, machines, and other means of production, does not as yet stamp a man as a capitalist if there be wanting the correlative – the wage-worker, the other man who is compelled to sell himself of his own free-will. He discovered that capital is not a thing, but a social relation between persons, established by the instrumentality of things. Mr. Peel, he moans, took with him from England to Swan River, West Australia, means of subsistence and of production to the amount of £50,000. Mr. Peel had the foresight to bring with him, besides, 3,000 persons of the working-class, men, women, and children. Once arrived at his destination, 'Mr. Peel was left without a servant to make his bed or fetch him water from the river.' Unhappy Mr. Peel, who provided for everything except the export of English modes of production to Swan River![9]

This is indicative of Marx's more general fascination with settler colonialism, and his interest in how "free" lands—or, more accurately, lands seized from indigenous people—could disrupt capitalist social relations.

Ongoing primitive accumulation

"Orthodox" Marxists see primitive accumulation as something that happened in the late Middle Ages and finished long ago, when capitalist industry started. They see primitive accumulation as a process happening in the transition from the feudal "stage" to the capitalist "stage".

However, this can be seen as a misrepresentation of both Marx's ideas and historical reality, since feudal-type economies exist in various parts of the world, even in the 21st century.

Marx's story of primitive accumulation is best seen as a special case of the general principle of capitalist market expansion. In part, trade grows incrementally, but usually the establishment of capitalist relations of production involves force and violence; transforming property relations means that assets previously owned by some people are no longer owned by them, but by other people, and making people part with their assets in this way involves coercion.

In his preface to Das Kapital Vol. 1, Marx writes "The country that is more developed industrially only shows, to the less developed, the image of its own future". The less developed countries also face a process of primitive accumulation, it is an ongoing process of expropriation, Proletarianization and Urbanization. Marx comments that "if, however, the German reader shrugs his shoulders at the condition of the English industrial and agricultural labourers, or in optimist fashion comforts himself with the thought that in Germany things are not nearly so bad, I must plainly tell him, "De te fabula narratur ! (the tale is told of you!)".

Marx was referring here to the expansion of the capitalist mode of production (not the expansion of world trade), through expropriation processes. He continues, "Intrinsically, it is not a question of the higher or lower degree of development of the social antagonism that results from the natural laws of capitalist production. It is a question of these laws themselves, of these tendencies working with iron necessity towards inevitable results."

David Harvey's theory of accumulation by dispossession

David Harvey expands the concept of "primitive accumulation" to create a new concept, "accumulation by dispossession", in his 2003 book, "The New Imperialism". Like Mandel, Harvey claims that the word "primitive" leads to a misunderstanding in the history of capitalism; that the original, "primitive" phase of capitalism is somehow a transitory phase that need not be repeated once commenced. Instead, Harvey maintains that primitive accumulation ("accumulation by dispossession") is a continuing process within the process of capital accumulation on a world scale. Because the central Marxian notion of crisis via "over-accumulation" is assumed to be a constant factor in the process of capital accumulation, the process of "accumulation by dispossession" acts as a possible safety valve that may temporarily ease the crisis. This is achieved by simply lowering the prices of consumer commodities (thus pushing up the propensity for general consumption), which in turn is made possible by the considerable reduction in the price of production inputs. Should the magnitude of the reduction in the price of inputs outweigh the reduction in the price of consumer goods, it can be said that the rate of profit will, for the time being, increase. Thus:

"Access to cheaper inputs is, therefore, just as important as access to widening markets in keeping profitable opportunities open. The implication is that non-capitalist territories should be forced open not only to trade (which could be helpful) but also to permit capital to invest in profitable ventures using cheaper labour power, raw materials, low-cost land, and the like. The general thrust of any capitalist logic of power is not that territories should be held back from capitalist development, but that they should be continuously opened up." (Harvey, The New Imperialism, p. 139).

Harvey's theoretical extension encompasses more recent economic dimensions such as intellectual property rights, privatization, and predation and exploitation of nature and folk lore.

Privatization of public services puts enormous profit into capitalists' hands. If it belonged to the public sector, that profit would not have existed. In that sense, the profit is created by dispossession of peoples or nations. Destructive industrial use of the environment is similar because the environment "naturally" belongs to everyone, or to no one: factually, it "belongs" to whoever lives there.

Multinational pharmaceutical companies collect information about how herb or other natural medicine is used among natives in less-developed country, do some R&D to find the material that make those natural medicines effective, and patent the findings. By doing so, multinational pharmaceutical companies can now sell the medicine to the natives who are the original source of the knowledge that made production of medicine possible. That is, dispossession of folklore (knowledge, wisdom, practice) through intellectual property rights.

David Harvey also argues that accumulation by dispossession is a temporal or partial solution to over-accumulation. Because accumulation by dispossession makes raw materials cheaper, the profit rate can at least temporarily go up.

Harvey’s interpretation has been criticized by Brass,[10] who disputes the view that what is described as present-day primitive accumulation, or accumulation by dispossession, entails proletarianization. Because the latter is equated by Harvey with the separation of the direct producer (mostly smallholders) from the means of production (land), Harvey assumes this results in the formation of a workforce that is free. By contrast, Brass points out that in many instances the process of depeasantization leads to workers who are unfree, because they are unable personally to commodify or recommodify their labour-power, by selling it to the highest bidder.

Schumpeter's critique of Marx's theory

The economist Joseph Schumpeter disagreed with the Marxist explanation of the origin of capital, because Schumpeter did not believe in exploitation. In liberal economic theory, the market returns to each person the exact value she added into it; capitalists are just people who are very adept at saving and whose contributions are especially magnificent, and they do not take anything away from other people or the environment. Liberalists believe that capitalism has no internal flaws or contradictions; only outside threats. To liberals, the idea of the necessity of violent primitive accumulation to capital is particularly incendiary. Schumpeter wrote rather testily:

"[The problem of Original Accumulation] presented itself first to those authors, chiefly to Marx and the Marxists, who held an exploitation theory of interest and had, therefore, to face the question of how exploiters secured control of an initial stock of 'capital' (however defined) with which to exploit – a question which that theory per se is incapable of answering, and which may obviously be answered in a manner highly uncongenial to the idea of exploitation" (Joseph Schumpeter, Business Cycles, Vol. 1, New York; McGraw-Hill, 1939, p. 229).

Schumpeter argued that imperialism was not a necessary jump-start for capitalism, nor is it needed to bolster capitalism, because imperialism pre-existed capitalism. Schumpeter believed that, whatever the empirical evidence, capitalist world trade could in principle just expand peacefully. If imperialism occurred, Schumpeter asserted, it has nothing to do with the intrinsic nature of capitalism itself, or with capitalist market expansion. The distinction between Schumpeter and Marx here is subtle. Marx claimed that capitalism requires violence and imperialism—first, to kick-start capitalism with a pile of booty and to dispossess a population to induce them to enter into capitalist relations as workers, and then to surmount the otherwise-fatal contradictions generated within capitalist relations over time. Schumpeter's view was that imperialism is an atavistic impulse pursued by a state independent of the interests of the economic ruling class.

Imperialism is the object-less disposition of a state to expansion by force without assigned limits... Modern Imperialism is one of the heirlooms of the absolute monarchical state. The "inner logic" of capitalism would have never evolved it. Its sources come from the policy of the princes and the customs of a pre-capitalist milieu. But even export monopoly is not imperialism and it would never have developed to imperialism in the hands of the pacific bourgeoisie. This happened only because the war machine, its social atmosphere, and the martial will were inherited and because a martially oriented class (i.e., the nobility) maintained itself in a ruling position with which of all the varied interests of the bourgeoisie the martial ones could ally themselves. This alliance keeps alive fighting instincts and ideas of domination. It led to social relations which perhaps ultimately are to be explained by relations of production but not by the productive relations of capitalism alone.

— Joseph A. Schumpeter, The Sociology of Imperialism (1918).

See also

Notes

  1. ^ a b Perelman, p. 25 (ch. 2)
  2. ^ David Harvey, class 12, time range 20:00–22:00
  3. ^ David Harvey (2005), ch. 4 "Accumulation by Dispossession", pp. 149, 145–6
  4. ^ Smith 1776, 2.3 (Book Two, Of the Nature, Accumulation, and Employment of Stock., Introduction) quote: "... the accumulation of stock must, in the nature of things, be previous to the division of labour..."
  5. ^ Karl Marx's Capital, vol I Ch. 26, states "The whole movement, therefore, seems to turn in a vicious circle, out of which we can only get by supposing a primitive accumulation (previous accumulation of Adam Smith) preceding capitalistic accumulation; an accumulation not the result of the capitalistic mode of production, but its starting point." referring to Adam Smith's Wealth, Bk II introduction, "This accumulation must, evidently, be previous to his applying his industry for so long a time to such a peculiar business."
  6. ^ Perelman, p. 170 (ch. 7)
  7. ^ http://www.marxists.org/archive/marx/works/1867-c1/ch31.htm
  8. ^ "Economic Manuscripts: Capital Vol. I - Chapter Thirty Two". www.marxists.org. Retrieved 2016-01-04.
  9. ^ "Economic Manuscripts: Capital Vol. I - Chapter Thirty Three". www.marxists.org. Retrieved 2016-01-04.
  10. ^ journals.sagepub.com (2011). "Unfree labour as primitive accumulation? Capital & Class 35(1): 23-38". Capital & Class. 35: 23–38. doi:10.1177/0309816810392969.

References

Accumulation by dispossession

Accumulation by dispossession is a concept presented by the Marxist geographer David Harvey, which defines the neoliberal capitalist policies in many western nations, from the 1970s and to the present day, as resulting in a centralization of wealth and power in the hands of a few by dispossessing the public and private entities of their wealth or land. These neoliberal policies are guided mainly by four practices: privatization, financialization, management and manipulation of crises, and state redistributions.

Antagonistic contradiction

Antagonistic contradiction (Chinese language: 矛盾; Pinyin: Máo dùn) is the notion that compromise between different social classes is impossible, and their relations must be of class struggle. The term is most often applied in Maoist theory, which holds that differences between the two primary classes, the working class/proletariat and the bourgeoisie are so great that there is no way to bring about a reconciliation of their views. Because the groups involved have diametrically opposed concerns, their objectives are so dissimilar and contradictory that no mutually acceptable resolution can be found. Nonantagonistic contradictions may be resolved through mere debate, but antagonistic contradictions can only be resolved through struggle.

The term is usually attributed to Vladimir Lenin, although he may never have actually used the term in any of his written works.

In Maoism, the antagonistic contradiction was usually that between the peasantry and the landowning class. Mao Zedong expressed his views on the policy in his famous February 1957 speech "On the Correct Handling of Contradictions Among the People."

Bourgeois nationalism

In Marxism, bourgeois nationalism is the practice by the ruling classes of deliberately dividing people by nationality, race, ethnicity, or religion, so as to distract them from initiating class warfare. It is seen as a divide and conquer strategy used by the ruling classes to prevent the working class from uniting against them (hence the Marxist slogan, Workers of all countries, unite!).

Central Committee

Central Committee is the common designation of a standing administrative body of communist parties, analogous to a board of directors, whether ruling or non-ruling in the 20th century and of the surviving communist states in the 21st century. In such party organizations the committee would typically be made up of delegates elected at a party congress. In those states where it constituted the state power, the Central Committee made decisions for the party between congresses, and usually was (at least nominally) responsible for electing the Politburo. In non-ruling Communist parties, the Central Committee is usually understood by the party membership to be the ultimate decision-making authority between Congresses once the process of democratic centralism has led to an agreed-upon position.

Non-Communist organizations are also governed by Central Committees, such as the right-wing Likud party in Israel, the Mennonite Church and Alcoholics Anonymous, as well as the Central Committee for Conscientious Objectors (to war). In the United States the two major parties are administered by the Democratic National Committee and the Republican National Committee; these act as the leading bodies of those organizations at the national/administrative level, as well as local committees in a similar capacity within the local Democratic or Republican governments of individual counties and states.

Commanding heights of the economy

The commanding heights of the economy refers to existing private industry essential to the economy like public utilities, natural resources, heavy industry and transport as well as control over foreign and domestic trade. This phrase emerged from a branch of modern political philosophy concerned with organizing society and can be traced back to Karl Marx's idea on socialism, which stresses the commanding heights and advocates for government control of it. This should not be confused with complete socialism or communism.

According to Yevgeni Preobrazhensky, a Bolshevik economist, control over the "commanding heights of the economy" would ensure "primitive socialist accumulation". Deng Xiaoping, the leader who along with Chen Yun introduced the Chinese economic reforms, was inspired by this concept. The Communist Party of China still believes to this day that the state needs to control the economy's commanding heights.

Feudal fascism

Feudal fascism, also revolutionary-feudal totalitarianism, were official terms used by the post-Mao Zedong Communist Party of China to designate the ideology and rule of Lin Biao and the Gang of Four during the Cultural Revolution.

General line of the party

In the terminology of communism, the general line of the party or simply the general line refers to the directives of the governing bodies of a party (usually a communist party) which define the party's politics. The term (Russian: Генеральная линия партии general'naya liniya partii) was in common use by the Communist Party of the Soviet Union (since its early days under other names) and also adopted by many other communist parties around the world. The notion is rooted in the major principle of democratic centralism, which requires unconditional obedience to top level decisions at all party levels.

Liquidationism

In Leninist theory, liquidationism (Russian: Ликвидаторство) is the ideological abandonment (liquidation) of the vanguard party's program, either in whole or in part, by party members.

Means of labor

Means of labor is a concept in Marxist political economy that refers to "all those things with the aid of which man acts upon the subject of his labor, and transforms it." (Institute of Economics of the Academy of Sciences of the U.S.S.R., 1957) Means of labor include tools and machinery (the "instruments of production"), as well as buildings and land used for production purposes and infrastructure like roads and communications networks and so forth. Labor, Itself defines "work, especially hard physical work."

The means of labor are one of three basic factors of the production process (Marx, 1967, p 174), along with human labor, and the subject of labor (the material worked on).

In some formulations, the means of labor and human labor (including the activity itself, as well as the skills and knowledge brought to the production process) comprise the productive forces of society (e.g., Sheptulin, 1978), other formulations define productive forces more narrowly as the union of instruments of production and the workers who wield them (e.g., Institute of Economics, 1957).

Merchant capitalism

Some economic historians use the term merchant capitalism to refer to the earliest phase in the development of capitalism as an economic and social system. However, others argue that mercantilism, which has flourished widely in the world without the emergence of systems like modern capitalism, is not actually capitalist as such.Merchant capitalism is distinguished from more fully developed capitalism by its focus on simply moving goods from a market where they are cheap to a market where they are expensive (rather than influencing the mode of the production of those goods), the lack of industrialization, and of commercial finance. Merchant houses were backed by relatively small private financiers acting as intermediaries between simple commodity producers and by exchanging debt with each other. Thus, merchant capitalism preceded the capitalist mode of production as a form of capital accumulation. A process of primitive accumulation of capital, upon which commercial finance operations could be based and making application of mass wage labor and industrialization possible, was the necessary precondition for the transformation of merchant capitalism into industrial capitalism.Early forms of merchant capitalism developed in the medieval Islamic world from the 9th century, and in medieval Europe from the 12th century. In Europe, merchant capitalism became a significant economic force in the 16th century. The mercantile era drew to a close around 1800, giving way to industrial capitalism. However, merchant capitalism remained entrenched in some parts of the West well into the 19th century, notably the Southern United States, where the plantation system constrained the development of industrial capitalism (limiting markets for consumer goods) whose political manifestations prevented Northern legislators from passing broad economic packages (e.g. monetary and banking reform, a transcontinental railroad, and incentives for settlement of the American west) to integrate the states' economies and spur the growth of industrial capitalism.

National liberation (Marxism)

National liberation has been a theme within Marxism, and especially after the influence of Vladimir Lenin's advocacy of anti-imperialism and self-determination of all peoples became prevalent in communist movements, especially in advocating freedom from colonial rule in the Third World. National liberation has been promoted by Marxists out of an international-socialist perspective rather than a bourgeois-nationalist perspective.Upon rising to power, Lenin and the Bolshevik government in Russia declared that all peoples had the right to self-determination. While Lenin was critical of nationalism, he claimed that the cause of national liberation was not a matter of chauvinism, but a matter of radical democracy.

Primitive socialist accumulation

Primitive socialist accumulation (sometimes socialist accumulation) was a concept put forth in the early Soviet Union during the period of the New Economic Policy. It was developed as a counterpart to the process of the primitive accumulation of capital that took place during the early stages and development of capitalist economies. Because the Soviet economy was underdeveloped and largely agrarian in nature, the Soviet state would have to be the agent of primitive capital accumulation to rapidly develop the Soviet economy. The concept was proposed as a means to industrialize the Russian economy of the era through state capitalism because the Russian economy was too underdeveloped to implement socialism at the time.

Proletarian revolution

A proletarian revolution is a social revolution in which the working class attempts to overthrow the bourgeoisie. Proletarian revolutions are generally advocated by socialists, communists and most anarchists.

Marxists believe proletarian revolutions can and will likely happen in all capitalist countries, related to the concept of world revolution.

The Leninist branch of Marxism argues that a proletarian revolution must be led by a vanguard of "professional revolutionaries", men and women who are fully dedicated to the communist cause and who form the nucleus of the communist revolutionary movement. This vanguard is meant to provide leadership and organization to the rest of the working class before and during the revolution, which aims to prevent the government from successfully ending it.Other Marxists such as Luxemburgists disagree with the Leninist idea of a vanguard and insist that the entire working class—or at least a large part of it—must be deeply involved and equally committed to the socialist or communist cause in order for a proletarian revolution to be successful. To this end, they seek to build mass working class movements with a very large membership.

Finally, there are socialist anarchists and libertarian socialists. Their view is that the revolution must be a bottom-up social revolution which seeks to transform all aspects of society and the individuals which make up the society (see Revolutionary Catalonia). In the words of Alexander Berkman, "there are revolutions and revolutions. Some revolutions change only the governmental form by putting a new set of rulers in place of the old. These are political revolutions, and as such they often meet with little resistance. But a revolution that aims to abolish the entire system of wage slavery must also do away with the power of one class to oppress another. That is, it is not any more a mere change of rulers, of government, not a political revolution, but one that seeks to alter the whole character of society. That would be a social revolution".

Revolutionary base area

In Mao Zedong's original formulation of the concept of people's war, a revolutionary base area (Chinese: 革命根据地 gémìng gēnjùdì) is a local stronghold that the revolutionary force conducting the people's war should attempt to establish, starting from a remote area with mountainous or forested terrain in which its enemy is weak.

This kind of base helps the revolutionary conducting force to exploit the few advantages that a small revolutionary movement has—broad-based popular support can be one of them—against a state's power with a large and well-equipped army.

Simple commodity production

Simple commodity production (also known as "petty commodity production"; the German original phrase is einfache Warenproduktion) is a term coined by Frederick Engels to describe productive activities under the conditions of what Marx had called the "simple exchange" of commodities, where independent producers trade their own products. The use of the word "simple" does not refer to the nature of the producers or of their production, but to the relatively simple and straightforward exchange processes involved.

Social murder

Social murder is a phrase used by Friedrich Engels in his 1845 work The Condition of the Working-Class in England whereby "the class which at present holds social and political control" (i.e. the bourgeoisie) "places hundreds of proletarians in such a position that they inevitably meet a too early and an unnatural death". This was in a different category to murder and manslaughter committed by individuals against one another, as social murder explicitly was committed by the political and social elite against the poorest in society.Although originally written with regard to the English city of Manchester in the Victorian era, the term has controversially been used by left-wing politicians such as John McDonnell in the 21st century to describe Conservative economic policy, as well as events such as the Grenfell Tower fire.

Super-imperialism

Super-imperialism is a Marxist term with two possible meanings. It refers either to the hegemony of an imperialist great power over its weaker rivals who then are called sub-imperialisms, or to a comprehensive supra-structure above a set of theoretically equal-righted imperialist states. The latter meaning is the older one and had become rare by the middle of the 20th century.

Theoretician (Marxism)

In Marxism, a theoretician is an individual who observes and writes about the condition or dynamics of society, history, or economics, making use of the main principles of Marxian socialism in the analysis.

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