“Perhaps our grandchildren will be using magnetic levitation trains, but in the 1960s we expected linear induction monorail trains to be in use by 1980. After all, they were building a prototype in East Anglia. High-speed tilting trains were being developed by British Rail in the late 1960s and were scheduled for use in the ’70s along with 125 mph diesel for other lines. Current Virgin Train diesel is no faster than those HSTs. In 1975 I could go from Edinburgh to London in 4 hrs 20 mins; it is no faster today, forty years later. Where are the flying cars, personal jetpacks, and 15-hour working weeks we were promised?” [1]
This passage from Cockshott is in reference to the state of technology in Britain as it is in the early 21st century, yet the sentiment being expressed goes true for a large part of the developed capitalist world. It is clear that there has been a slowdown in technical progress in the places where it used to be the most apparent, but what explains such a slowdown? Is it just that the basic technology complex of industrial society is drawing close to its limit? That could certainly be a determining factor, but there are also other factors relating to the social relations which govern the currently dominant form of surplus extraction, that being capitalism. Even though capitalism has produced in Europe a technological leap that initiated a phase change in the entire structure of the world economy, its internal contradictions have at last caused it to become a fetter on the development of the countries that were once its champions. What these contradictions are, and how they manifest themselves, are worth being examined.
The falling rate of profit and the incentive for advance
One of the core elements of Marx’s labor theory of value is that value is produced during production, not during exchange via the market as the neoclassical would have you believe. The surplus produced by workers during production is appropriated by capitalists, returning to them in the form of profit. It follows that as capitalists employ more workers they get access to a larger pool of labor they can exploit and get higher rates of profit as a result. This however is only one side of the story. Besides the living labor the workers put out during their working day, there’s also dead labor in the form of the machines they use. This dead labor doesn’t produce value and therefore doesn’t produce a surplus that can be appropriated by capitalists [2]. There are thus two components in any production process, one which can be exploited for profit and another which can’t. What this ultimately means is that in the early stages of capitalist development, when there is a small amount of machinery being operated by a large number of workers, the exploitable part of production takes up more space and the rate of profit is high, but as capitalists install more machinery to amp up productivity, the ratio of machines to workers goes up and the profitability of the production process goes down, discouraging investment.
This phenomenon is quite easily observable in the real world, as the most advanced capitalist economies in the world have seen a decline in the growth in labor productivity, and in investments made by capitalists in new labor-saving technologies, since the time of the OPEC crisis [3]. The subsequent switch to neoliberalism was meant to raise the rate of profit by increasing the rate of exploitation but it didn’t have the effect of restarting an orientation toward technical progress given that investing in the development and implementation of new technologies is a very capital-intensive process that would offset the attempts to maintain a high rate of profit.
The self-defeating nature of capitalism is on full display here: Capitalists invest in technologies to be able to make more money, investments get less and less profitable as time goes on, and they end up turning to hoarding or speculating which is of no benefit to anyone but themselves. This is the case in Europe as it is in the Anglo-Saxon settler colonies and Japan but the picture in China is quite different. The East is rising and it’s rising fast, and the reasons for it have much to do with the natural laws of capitalist development mentioned previously. That being said, a simple east-west comparison
doesn’t show the whole picture. The world may have its eyes on China, but the other ancient civilization of Asia, India, also offers us insights into the conditions that must be satisfied in order to make way for technical progress.
The burden of exploitation
Money wages are a powerful tool in that they mask the real value relations present in the economy. It is said that wages are the price of labor, but that’s not really the case. If wages were the direct monetary equivalent of labor, then there’d be no surplus available for the owners to take for themselves. Instead, wages are the price of labor power, the ability to work, and not the whole product of labor. Wages, therefore, mask the true cost of production by systematically undervaluing living labor. This has adverse effects on technical progress, as capitalism’s progressiveness in terms of implementing labor-saving machinery becomes inversely proportional to the level of real wages. The more well-off the workers are, the more incentive there will be to replace them with machines.
There is no shortage of historical examples to show the negative correlation between wages and mechanization. In England, France, and Italy, the real wage rose sharply after the labor shortages of the black death, but only in England did it stay high, so that when the scientific knowledge and arts necessary for the powered industry had been developed in the Renaissance, only in England did it pay to use them. The United States, an offshoot of England, also experienced a marked increase in mechanization after the abolition of the super-exploitation of labor in the form of slavery, as was observed by Marx and his contemporaries like Cairnes.
This leads us to India and the state of Indian workers today. Despite the formal abolition of slavery like in the United States, slavery still continues in practice to this day, with estimates that there are around 40 million bonded laborers in modern India [4]. Bonded labor by members of the lower castes is rife in agriculture, even in more developed regions like the Punjab, and similar conditions of near slavery exist in other sectors where heavy manual labor is done in quarries, mines, handloom weaving, salt pan work, and construction. In the southeastern state of Tamil Nadu, of 750,000 workers in the quarries, two-thirds are bonded laborers, with, in many cases, whole families being
enslaved. The presence of such semi-servile relations of production discourages mechanization, as the initial investment required to introduce machinery scares off the owners who’d much rather keep relying on slave labor. For India to develop there thus has to be a real social revolution to transform the relations of production and end the currently existing forms of slavery.
In the first section, the falling rate of profit was shown to be in the way of technical progress in the developed capitalist world, but the example of India shows that even countries that haven’t reached that level of development will be held back by the inherently exploitative systems of private ownership. In light of these observations, the advances made in China should be of particular interest to the advocates of public ownership.
Science for the people
As discussed previously, high capital intensity corresponds to low profitability which results in capital-intensive industries being less attractive to investors. A good example of just such an industry would be rail transport. As the need to transition to alternative energy sources becomes more apparent by the day, rail freight will have to become electrified, which is difficult if the railways are being run profit. In the United States, where the railways are private, only 1% of the rail network is electrified with the rest running on diesel. The situation is quite different in China where the railways are state-owned. In 1975 only 5% of the rail network was electrified, but by now it is about 40% as a result of conscious central planning [5]. It is not technical constraints that are holding back railway electrification in large countries like the United States but rather private ownership. If we want to move forward with electrification, we will have to do away with private railways.
But why should we stop there? Consider the research conducted in the Soviet Union back in the day. The USSR had long-term plans for nonfossil energy sources like nuclear, thermonuclear, and orbiting solar power stations. The Tokamak design for thermonuclear reactors, which forms the basis for the International Thermonuclear Experimental Reactor (ITER), was invented in the USSR. They also had designs for
orbiting solar power stations that would overcome the limitations of day and night and bad weather by being bathed in permanent sunlight, beaming energy to Earth as microwaves. The ultimate Soviet space launcher, Energiya, was seen as the tool to build such orbiting stations. Private capital has shown itself to be unable to develop these technologies because of the huge initial investment, over many decades, before any possible profit could be returned. Such projects are contrary to the “logic” of the market because on a fundamental level, they’re meant to address future human needs and not just to make money. Even in the West, projects in the same vein like the AEC in the United States or the AEA in the UK for nuclear power have always been state sponsored.
At the end of the day, scientific knowledge is the result of the conscious effort of society, not the product of capitalist enterprise. This is as true today as it was at the dawn of capitalism, when science rested on state-sponsored research of the Hellenistic period in Syracuse or Alexandria. The current state of capitalism in the developed world, where the public sector has shrunk too much to carry out significant research and the private sector is unwilling to pursue new technologies because of low profitability, makes it necessary for us to unburden ourselves of its chains if we’re going to have a future on this planet. It is in a system where the exploitation of labor is abolished that there will be room for science to prosper.
“Only collaboration between scientists and workers can put an end to oppressive poverty, disease, and dirt. And this will be done.” – Lenin [6]
Cem Poyraz Özbay
BIBLIOGRAPHY :
[1] How the world works, Paul Cockshott
[2] For more on this see Ian Wright’s article Why Machines Don’t Create Value – Cosmonaut (cosmonautmag.com)
[3] Extended Penn World Tables
[4] Broken People: Caste Violence against India’s “Untouchables” Smita Narula
[5] What Are the Real Effects of Rail Electrification in Hungary?, Mattias Juhász
[6] Speech delivered at the second all Russia congress of medical workers, Lenin
Cem Poyraz Özbay, the "great Turk," was born in Istanbul and is currently studying law in France. He is interested, among other things, in Marxist political economy and the philosophy of materialism. He may seem a bit bold at first, but rest assured he becomes even more so as you get to know him. He is also a big fan of Elis Regina.