Marx’s Capital, Volume 1, Chapter 33: A Critical Summary

Chapter 33 of volume 1 of Capital is called “The Modern Theory of Colonisation” and examines how capitalism is established in European colonies. This is the final chapter of volume 1 of Capital.

By colonies, Marx means those countries with “virgin soils, colonised by free immigrants” (Marx 1906: 838, n. 1), such as America or Australia.

Marx is concerned with the theory of Edward Gibbon Wakefield (1796–1862), an Englishman who helped to colonise New Zealand, and the author of England and America (1834) and A View of the Art of Colonization (1849).

Marx describes Wakefield’s theory:

“It is the great merit of E. G. Wakefield to have discovered, not anything new about the Colonies, 1 but to have discovered in the Colonies the truth as to the conditions of capitalist production in the mother-country. As the system of protection at its origin attempted to manufacture capitalists artificially in the mother-country, so Wakefield's colonisation theory, which England tried for a time to enforce by Acts of Parliament, attempted to effect the manufacture of wage-workers in the Colonies. This he calls ‘systematic colonisation.’

First of all, 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.” (Marx 1906: 839).

In colonies, free settlers often have plenty of land to settle on which provides them with an independent means of subsistence and means of production (Marx 1990: 933), and so this inhibits the development of a class of property-less workers:

“‘If,’ says Wakefield, ‘all the members of the society are supposed to possess equal portions of capital ... no man would have a motive for accumulating more capital than he could use with his own hands. This is to some extent the case in new American settlements, where a passion for owning land prevents the existence of a class of labourers for hire.’ So long, therefore, as the labourer can accumulate for himself—and this he can do so long as he remains possessor of his means of production—capitalist accumulation and the capitalistic mode of production are impossible. The class of wage-labourers, essential to these, is wanting.” (Marx 1906: 840).

“We have seen that the expropriation of the mass of the people from the soil forms the basis of the capitalist mode of production. The essence of a free colony, on the contrary, consists in this — that the bulk of the soil is still public property, and every settler on it therefore can turn part of it into his private property and individual means of production, without hindering the later settlers in the same operation. This is the secret both of the prosperity of the colonies and of their inveterate vice—opposition to the establishment of capital. ‘Where land is very cheap and all men are free, where one who so pleases can easily obtain a piece of land for himself, not only is labour very dear, as respects the labourer’s share of the produce, but the difficulty is to obtain combined labour at any price.’” (Marx 1906: 841–842).

For Marx, the essence of capitalism production is as follows:

“The great beauty of capitalist production consists in this—that it not only constantly reproduces the wage-worker as wage-worker, but produces always, in proportion to the accumulation of capital, a relative surplus population of wageworkers. Thus the law of supply and demand of labour is kept in the right rut, the oscillation of wages is penned within limits satisfactory to capitalist exploitation, and lastly, the social dependence of the labourer on the capitalist, that indispensable requisite, is secured; an unmistakeable relation of dependence, which the smug political economist, at home, in the mother country, can transmogrify into one of free contract between buyer and seller, between equally independent owners of commodities, the owner of the commodity capital and the owner of the commodity labour. But in the colonies this pretty fancy is torn asunder. The absolute population here increases much more quickly than in the mother-country, because many labourers enter this world as ready-made adults, and yet the labour market is always understocked. The law of the supply and demand of labour falls to pieces. On the one hand, the old world constantly throws in capital, thirsting after exploitation and ‘abstinence;’ on the other, the regular reproduction of the wage-labourer as wage-labourer comes into collision with impediments the most impertinent and in part invincible. What becomes of the production of wage-labourers, supernumerary in proportion to the accumulation of capital? The wage-worker of to-day is- to-morrow an independent peasant, or artisan, working for himself. He vanishes from the labour-market, but not into the workhouse. This constant transformation of the wage-labourers into independent producers, who work for themselves instead of for capital, and enrich themselves instead of the capitalist gentry, reacts in its turn very perversely on the conditions of the labour-market. Not only does the degree of exploitation of the wage-labourer remain indecently low. The wage-labourer loses into the bargain, along with the relation of dependence, also the sentiment of dependence on the abstemious capitalist.” (Marx 1906: 842–843).

So the dependence of workers on capitalists “must be created by artificial means” (Marx 1906: 844).

Marx thinks the solution was this:

“How, then, to heal the anti-capitalistic cancer of the colonies? If men were willing, at a blow, to turn all the soil from public into private property, they would destroy certainly the root of the evil, but also—the colonies. The trick is how to kill two birds with one stone. Let the Government put upon the virgin soil an artificial price, independent of the law of supply and demand, a price that compels the immigrant to work a long time for wages before he can earn enough money to buy land, and turn himself into an independent peasant. The funds resulting from the sale of land at a price relatively prohibitory for the wage-workers, this fund of money extorted from the wages of labour by violation of the sacred law of supply and demand, the Government is to employ, on the other hand, in proportion as it grows, to import have-nothings from Europe into the colonies, and thus keep the wage-labour market full for the capitalists. Under these circumstances, tout sera pour le mieux dans le meilleur des mondes possibles. This is the great secret of ‘systematic colonisation.’ By this plan, Wakefield cries in triumph, ‘the supply of labour must be constant and regular, because, first, as no labourer would be able to procure land until he had worked for money, all immigrant labourers, working for a time for wages and in combination, would produce capital for the employment of more labourers; secondly, because every labourer who left off working for wages and became a landowner, would, by purchasing land, provide a fund for bringing fresh labour to the colony.’ The price of the soil imposed by the State must, of course, be a ‘sufficient price’—i.e., so high ‘as to prevent the labourers from becoming independent landowners until others had followed to take their place.’ This ‘sufficient price for the land’ is nothing but a euphemistic circumlocution for the ransom which the labourer pays to the capitalist for leave to retire from the wage-labour market to the land.” (Marx 1906: 846).

Marx thinks this was put into effect by England:

“It is very characteristic that the English Government for years practised this method of ‘primitive accumulation,’ prescribed by Mr. Wakefield expressly for the use of the colonies. The fiasco was, of course, as complete as that of Sir Robert Peel’s Bank Act. The stream of emigration was only diverted from the English colonies to the United States. Meanwhile, the advance of capitalistic production in Europe, accompanied by increasing Government pressure, has rendered Wakefield’s recipe superfluous. On the one hand, the enormous and ceaseless stream of men, year after year driven upon America, leaves behind a stationary sediment in the east of the United States, the wave of immigration from Europe throwing men on the labour market there more rapidly than the wave of emigration westwards can wash them away. On the other hand, the American Civil War brought in its train a colossal national debt, and, with it, pressure of taxes, the rise of the vilest financial aristocracy, the squandering of a huge part of the public land on speculative companies for the exploitation of railways, mines, &c, in brief, the most rapid centralisation of capital. The great republic has, therefore, ceased to be the promised land for emigrant labourers. Capitalistic production advances there with giant strides, even though the lowering of wages and the dependence of the wage-worker are yet far from being brought down to the normal European level. The shameless lavishing of uncultivated colonial land on aristocrats and capitalists by the Government, so loudly denounced even by Wakefield, has produced, especially in Australia, in conjunction with the stream of men that the gold-diggings attract, and with the competition that the importation of English commodities causes even to the smallest artisan, an ample ‘relative surplus labouring population,’ so that almost every mail brings the Job’s news of a ‘glut of the Australian labour-market,’ and prostitution in some places there flourishes as wantonly as in the London Haymarket.

However, we are not concerned here with the condition of the colonies. The only thing that interests us is the secret discovered in the new world by the political economy of the old world, and proclaimed on the house-tops: that the capitalist mode of production and accumulation, and therefore capitalist private property, have for their fundamental condition the annihilation of self-earned private property; in other words, the expropriation of the labourer.” (Marx 1906: 847–848).

This ends the final chapter of Capital.

Marx’s passage above verges on conspiracy theory. For example, consider the idea that the “English Government for years practised this method of ‘primitive accumulation,’ prescribed by Mr. Wakefield expressly for the use of the colonies” (Marx 1906: 847).

Wakefield’s colonial theories seem to have been most influential in the private-sector New Zealand Company, but not in British government circles.

When Wakefield went to New Zealand in 1853, he discovered that the governor George Grey did not agree with his colonial theories as pursued by the New Zealand Company:

“Wakefield went on the attack almost as soon as he landed [sc. in Wellington, New Zealand]. He took issue with George Grey on his policy on land sales. Grey was in favour of selling land very cheaply to encourage the flow of settlers. Wakefield wanted to keep the price of land high so that the growth of the colony could be financed by land sales, it was a fundamental tenet of his colonial theory. He and Sewell applied for an injunction to prevent the Commissioner of Crown Lands selling any further lands under Governor Grey’s regulations.”
https://en.wikipedia.org/wiki/Edward_Gibbon_Wakefield#Wakefield_in_New_Zealand

But George Grey prevailed against Wakefield. So the British government policy in New Zealand was contrary to Marx’s theory (as taken from Wakefield), and the reduction in land prices had been directed from the government in London by Earl Grey (Stuart 1971: 28). Nevertheless, capitalist agriculture and capitalism generally proceeded to develop in New Zealand, and so much so that New Zealand had a very high real per capita GDP by the early 20th century.

Finally, the idea that America “ceased to be the promised land for emigrant labourers” by 1867 is absurd, given the opening up and settlement of the West from the 1870s to the 1890s.

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Stuart, Peter A. 1971. Edward Gibbon Wakefield in New Zealand: His Political Career 1853–4. Price Milburn, Wellington.

Wakefield, Edward Gibbon. 1834. England and America. A Comparison of the Social and Political State of Both Nations. Harper & Brothers, New York.
https://archive.org/details/englandamericaco00wake

Wakefield, Edward Gibbon. 1849. A View of the Art of Colonization, with Present Reference to the British Empire; In letters between a Statesman and a Colonist. J. W. Parker, London.
https://archive.org/details/viewofartofcolon00wakerich

Marx’s Capital, Volume 1, Chapter 32: A Critical Summary

Chapter 32 of volume 1 of Capital is called the “Historical Tendency of Capitalist Accumulation” and is essentially Marx’s conclusion to Capital, since Chapter 33 is more of an appendix and addendum to the volume (Brewer 1984: 83).

Chapter 32 is therefore Marx’s summing up of his vision of the past and future of capitalism, and contains a famous – and discredited – doomsday prediction of the collapse of capitalism.

The tendency of “primitive accumulation of capital” which Marx has described in Part 8 is fundamentally to destroy independent farmers and artisans who own their own means of production:

“The private property of the labourer in his means of production is the foundation of petty industry, whether agricultural, manufacturing or both; petty industry, again, is an essential condition for the development of social production and of the free individuality of the labourer himself. Of course, this petty mode of production exists also under slavery, serfdom, and other states of dependence. But it flourishes, it lets loose its whole energy, it attains its adequate classical form, only where the labourer is the private owner of his own means of labour set in action by himself: the peasant of the land which he cultivates, the artizan of the tool which he handles as a virtuoso. This mode of production pre-supposes parcelling of the soil, and scattering of the other means of production. As it excludes the concentration of these means of production, so also it excludes cooperation, division of labour within each separate process of production, the control over, and the productive application of the forces of Nature by society, and the free development of the social productive powers. It is compatible only with a system of production, and a society, moving within narrow and more or less primitive bounds.” (Marx 1906: 834–835).

But forces within this society destroy it:

“At a certain stage of development it brings forth the material agencies for its own dissolution. From that moment new forces and new passions spring up in the bosom of society; but the old social organization fetters them and keeps them down. It must be annihilated; it is annihilated. Its annihilation, the transformation of the individualised and scattered means of production into socially concentrated ones, of the pigmy property of the many into the huge property of the few, the expropriation of the great mass of the people from the soil, from the means of subsistence, and from the means of labour, this fearful and painful expropriation of the mass of the people forms the prelude to the history of capital. It comprises a series of forcible methods, of which we have passed in review only those that have been epoch-making as methods of the primitive accumulation of capital. The expropriation of the immediate producers was accomplished with merciless Vandalism, and under the stimulus of passions the most infamous, the most sordid, the pettiest, the most meanly odious. Self-earned private property, that is based, so to say, on the fusing together of the isolated, independent labouring-individual with the conditions of his labour, is supplanted by capitalistic private property, which rests on exploitation of the nominally free labour of others, i.e., on wages-labour.” (Marx 1906: 835–836).

Marx now makes his famous doomsday prediction of the collapse of capitalism:

“As soon as this process of transformation has sufficiently decomposed the old society from top to bottom, as soon as the labourers are turned into proletarians, their means of labour into capital, as soon as the capitalist mode of production stands on its own feet, then the further socialisation of labour and further transformation of the land and other means of production into socially exploited and, therefore, common means of production, as well as the further expropriation of private proprietors, takes a new form. That which is now to be expropriated is no longer the labourer working for himself, but the capitalist exploiting many labourers. This expropriation is accomplished by the action of the immanent laws of capitalistic production itself, by the centralisation of capital. One capitalist always kills many. Hand in hand with this centralisation, or this expropriation of many capitalists by few, develop, on an ever extending scale, the co-operative form of the labour-process, the conscious technical application of science, the methodical cultivation of the soil, the transformation of the instruments of labour into instruments of labour only usable in common, the economising of all means of production by their use as the means of production of combined, socialised labour, the entanglement of all peoples in the net of the world-market, and this, the international character of the capitalistic regime. Along with the constantly diminishing number of the magnates of capital, who usurp and monopolise all advantages of this process of transformation, grows the mass of misery, oppression, slavery, degradation, exploitation; but with this too grows the revolt of the working-class, a class always increasing in numbers, and disciplined, united, organised by the very mechanism of the process of capitalist production itself. The monopoly of capital becomes a fetter upon the mode of production, which has sprung up and flourished along with, and under it. Centralisation of the means of production and socialisation of labour at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.”

The capitalist mode of appropriation, the result of the capitalist mode of production, produces capitalist private property. This is the first negation of individual private property, as founded on the labour of the proprietor. But capitalist production begets, with the inexorability of a law of Nature, its own negation. It is the negation of negation. This does not re-establish private property for the producer, but gives him individual property based on the acquisitions of the capitalist era: i.e., on co-operation and the possession in common of the land and of the means of production.

The transformation of scattered private property, arising from individual labour, into capitalist private property is, naturally, a process, incomparably more protracted, violent, and difficult, than the transformation of capitalistic private property, already practically resting on socialised production, into socialised property. In the former case, we had the expropriation
of the mass of the people by a few usurpers; in the latter, we have the expropriation of a few usurpers by the mass of the people.” (Marx 1906: 836–837).

In a final footnote, Marx quotes with approval this passage from Engels:

“The development of Modern Industry, therefore, cuts from under its feet, the very foundation on which the bourgeoisie produces and appropriates products. What the bourgeoisie therefore, produces, above all, are its own grave-diggers. Its fall and the victory of the proletariat are equally inevitable. … Of all the classes, that stand face to face with the bourgeoisie to-day, the proletariat alone is a really revolutionary class. The other classes perish and disappear in the face of Modern Industry, the proletariat is its special and essential product. … The lower middle-classes, the small manufacturers, the shop keepers, the artisan, the peasant, all these fight against the bourgeoisie, to save from extinction their existence as fractions of the middle-class … they are reactionary, for they try to roll back the wheel of history.” (Marx 1906: 837, n. 1).

So here and throughout Capital Marx envisages the historical tendency of capitalism as follows:

(1) capitalism tends to increase the (1) accumulation, (2) concentration (accumulation over time) and (3) centralisation of capital. Capitalism will therefore have a tremendous tendency towards monopoly.

(2) following from (1), capitalism will tend to destroy more and more capitalists and result in huge centralisation of capital (or monopoly) and reduce even capitalists to the proletarian class;

(3) capitalism will tend to use more and more machines and automation in production resulting in a huge body of unemployed people.

(4) following from (3), the industrial reserve army of labour (the unemployed) grows and grows, and helps to hold real wages in check (see Chapter 25). Even more, Marx thought that a large and growing industrial reserve army is a necessary condition of capitalism: it was a “condition of existence of the capitalist mode of production” (Marx 1906: 646).

(5) the tendency of capitalism is to keep the real wage at a subsistence level, which is the value of the maintenance and reproduction of labour-power (on this, see Chapter 25 and here). Wages rise and fall around this subsistence level as an equilibrium process;

(6) machines will only increase the intensity, speed and arduousness of work for the proletarians and their misery (see Chapter 15 of volume 1), and also increase the employment of women and children who are paid a lower wage than adult men (although government laws might counter this latter trend to some extent). The adult men are then increasing thrown out of work by machines and women and children replace them with lower wages;

(7) volume 3 of Capital adds to this the tendency of the profit rate to fall, but this mechanism is not invoked in volume 1 as one of the causes of the collapse, and some modern Marxists now dispute just how important the tendency of the falling rate of profit was for the final collapse of capitalism in Marx’s theory, as the emphasis given to this may be more the result of Engels’ tendentious editing of volume 3 of Capital.

(8) eventually almost the whole of society is reduced to the proletarian class with only a tiny handful of monopoly capitalists, who according to Marx “usurp and monopolise all advantages of this process of transformation” (Marx 1906: 836).

(9) the huge and constantly growing class of proletarians, who are kept in poverty with a subsistence wage, are subject to an increasing “mass of misery, oppression, slavery, degradation, [and] exploitation” (Marx 1906: 836). As in the passage of Engels quoted by Marx, the “other classes perish and disappear in the face of Modern Industry” (Marx 1906: 837, n. 1).

(10) finally, the proletarians eventually organise and rebel against capitalism, overthrowing the system.

Now these predictions judged in their totality were not the long-run tendency of capitalism.

Even if a few elements are true (e.g., the increasing use of machines), nevertheless Marx’s vision is a delusional Marxist caricature of capitalism which has been falsified by history.

We can run through the failed predictions as follows:

(1) the tendency to monopoly has its limits even in capitalism, and the extreme and increasing degree of monopoly as predicted by Marx goes well beyond anything observed in real world capitalism;

(2) the size of the working class eventually stabilised and society was swelled by a growing and prosperous middle class and social mobility. Unemployment rates in capitalism are simply a cyclical result of the business cycle: even in the 19th century, unemployment rates did not grow and grow in the long run, as Marx’s theory predicts, but normally simply moved around a point somewhat above full employment, as John Maynard Keynes pointed out:

“our actual experience … [sc. is] that we oscillate, avoiding the gravest extremes of fluctuation in employment and in prices in both directions, round an intermediate position appreciably below full employment and appreciably above the minimum employment a decline below which would endanger life.”
Keynes, J. M. 1936. General Theory of Employment, Interest, and Money , Chapter 18.
https://www.marxists.org/reference/subject/economics/keynes/general-theory/ch18.htm

(3) Marx thought that the large industrial reserve army is a necessary consequence and necessary condition of capitalism, but this is incorrect. In the Keynesian era of full employment, where there was very low unemployment and indeed labour scarcity in the advanced capitalist world, capitalism continued and thrived – indeed we now call it the “Golden Age” of capitalism.

(4) the long-run tendency of capitalism, even in the 19th century, was to massively increase the real wage, which has soared above subsistence level, even for workers (see here and here).

(5) the growing real wage and rising disposable income even of workers in capitalism also allowed a massive capacity for production of new commodities and new opportunities for employment (e.g., especially in services and middle class employment), which in turn has helped to overcome technological unemployment.

(6) Marx’s claim that machines, generally speaking, are an unmitigated evil in capitalism whose primary effect to increase the intensity and speed of work by labourers is an outrageous falsehood – a perversion of history and reality. In reality, machines have, generally speaking, tended to decrease the intensity, difficulty and monotony of human labour and often reduced to human labour to lighter work of visual inspection and overseeing of machine work, not physical labour. On this, see here and here. Advanced capitalist nations have also virtually eliminated child labour as well, and in our time have tended to pay women the same hourly wage for the same type of work as men.

(7) highly developed and advanced Western capitalist states like Britain and the US proved the most resistant to communism and Marxism (contrary to Marx’s theory), and when communist revolutions broke out it was in backward Russia and China. Even the communist outbreaks in Germany and Italy at the end of the First World War were more the result of the collapse of those nations under the strain of war, and not in line with the vision Marx had predicted (as I noted here).

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Marx’s Capital, Volume 1, Chapter 31: A Critical Summary

Chapter 31 of volume 1 of Capital is called the “Genesis of the Industrial Capitalist.”

This chapter contains Marx’s views on the relationship between imperialism and colonialism and early capitalist development in Europe, which some modern Marxists have used to argue that imperialist looting and theft of wealth was a necessary precondition for Western capitalism (Brewer 1984: 82; Harvey 2010: 297). And Marx indeed does seem to think that the many aspects of the imperialist exploitation of the Americas were “the chief momenta of primitive accumulation” in Europe (Marx 1906: 823).

Already this argument runs into difficulties, because even though the Spanish were often the chief beneficiaries of the imperialist conquest of the New World, modern industrial capitalism did not develop in Spain.

At any rate, there is much that is of interest and even insightful in this chapter, but mixed up with Marxist myths and propaganda.

Marx begins with this historical sketch:

“The genesis of the industrial capitalist did not proceed in such a gradual way as that of the farmer. Doubtless many small guild-masters, and yet more independent small artisans, or even wage-labourers, transformed themselves into small capitalists, and (by gradually extending exploitation of wage-labour and corresponding accumulation) into full-blown capitalists. In the infancy of capitalist production, things often happened as in the infancy of mediaeval towns, where the question, which of the escaped serfs should be master and which servant, was in great part decided by the earlier or later date of their flight. The snail’s-pace of this method corresponded in no wise with the commercial requirements of the new world-market that the great discoveries of the end of the 15th century created. But the middle age had handed down two distinct forms of capital, which mature in the most different economic social formations, and which, before the era of the capitalist mode of production, are considered as capital quand même [sc. nevertheless]—usurer’s capital and merchant’s capital.” (Marx 1906: 822).

“The money capital formed by means of usury and commerce was prevented from turning into industrial capital, in the country by the feudal constitution, in the towns by the guild organization. These fetters vanished with the dissolution of feudal society, with the expropriation and partial eviction of the country population. The new manufacturers were established at sea-ports, or in inland points beyond the control of the old municipalities and their guilds. Hence in England an embittered struggle of the corporate towns against these new industrial nurseries.” (Marx 1906: 823).

In other passages in Capital, however, Marx does not regard early merchants and usurers as proper capitalists (Marx 1906: 182–183, 559–560), so there is some inconsistency here.

Marx thinks that imperialism was a crucial part of “primitive accumulation”:

“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, signalised the rosy dawn of the era of capitalist production. These idyllic proceedings are the chief momenta 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 momenta 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 organised force of society, to hasten, hothouse 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.” (Marx 1906: 823–824).

Marx lists various examples of European colonial theft and plundering as an important source of primitive accumulation (Marx 1990: 916–917).

He states:

“The colonial system ripened, like a hot-house, trade and navigation. The ‘societies Monopolia’ of Luther were powerful levers for concentration of capital. The colonies secured a market for the budding manufactures, and, through the monopoly of the market, an increased accumulation. The treasures captured outside Europe by undisguised looting, enslavement, and murder, floated back to the mother-country and were there turned into capital. Holland, which first fully developed the colonial system, in 1648 stood already in the acme of its commercial greatness. It was ‘in almost exclusive possession of the East Indian trade and the commerce between the south-east and north-west of Europe. Its fisheries, marine, manufactures, surpassed those of any other country. The total capital of the Republic was probably more important than that of all the rest of Europe put together.’ Gülich forgets to add that by 1648, the people of Holland were more overworked, poorer and more brutally oppressed than those of all the rest of Europe put together.

To-day industrial supremacy implies commercial supremacy. In the period of manufacture properly so-called, it is, on the other hand, the commercial supremacy that gives industrial predominance. Hence the preponderant role that the colonial system plays at that time. It was ‘the strange God’ who perched himself on the altar cheek by jowl with the old Gods of Europe, and one fine day with a shove and a kick chucked them all of a heap. It proclaimed surplus-value making as the sole end and aim of humanity.” (Marx 1906: 826–827).

There is a great deal of Marxist myth-making here.

It is summed up with Marx’s statement that

“The colonial system ripened, like a hot-house, trade and navigation. The ‘societies Monopolia’ of Luther were powerful levers for concentration of capital. The colonies secured a market for the budding manufactures, and, through the monopoly of the market, an increased accumulation. The treasures captured outside Europe by undisguised looting, enslavement, and murder, floated back to the mother-country and were there turned into capital.” (Marx 1906: 826).

That these things were really the “chief momenta of primitive accumulation” in Western capitalism that drove the industrial revolution can be seriously questioned, however.

Modern historical research by Paul Bairoch puts all this into doubt, which can be seen here and here.

The British industrial revolution had its origins in the agricultural revolution of 1680–1700 which accelerated from 1720–1760 and resulted in a large grain surplus even by the 1730s (Bairoch 1993: 80). But that arose from internal progress in the yields of crops and agricultural productivity (Bairoch 1993: 80), not imperial conquests. Many of the necessary technological innovations existed by 1750, but these had nothing to do with British imperialism.

Did non-European markets in the colonies provide a necessary condition for the British industrial revolution? Bairoch argues cogently that they did not.

The role of colonial trade in spurring industry in England seems minor. In the 18th century as the first phase of the industrial revolution gathered pace, the total export sector of the UK accounted for between 4–8% of Britain’s GDP, and of this only 33–39% of exports were bound for the Third World. But, crucially, only 2–3% of total national output was exported to the Third World (Bairoch 1993: 82). It was what Marx called the “home market” that largely provided the demand-side inducement to industrialisation in Britain.

Even in individual sectors where the importance of exports to the Third World was somewhat higher such as textiles and iron, the contribution of this colonial or Third world demand was not decisive for industrial development (Bairoch 1993: 84).

There was one sector in the 19th century in Britain which was oriented largely towards colonial markets: the cotton textile industry (Bairoch 1993: 84–85). By 1819/1821 cotton textile exports accounted for about 53% of production and a significant proportion of these went to colonies and the Third World (Bairoch 1993: 85). But this was only one industry amongst many in the industrial revolution, and even if colonial trade markets had been unavailable the sector would still have developed but just at a lower level of production.

Importantly, Bairoch (1993: 59) has demonstrated that right up until the post-WWII era the West was almost completely self-sufficient in energy, and as late as the 1930s much of the developed world had an export surplus in products used to create energy, such as coal (Bairoch 1993: 59). It follows therefore that the imperialist exploitation of the Third World was not necessary to provide the energy needs of early industrial capitalism.

With respect to other important factor inputs, Bairoch first notes that the West was almost wholly self-sufficient in iron ore: most production occurred in Europe where around 1914 Europe produced 28 million of the 32 million tons in global production (Bairoch 1993: 63). In 1914, the West only depended for 2% of its total metal ore consumption on Third World production – an extraordinarily low figure which means that 98% of metal ores were produced domestically (Bairoch 1993: 65).

In production of glass, cement, paper and clay products the West was almost completely independent and not reliant on imports (Bairoch 1993: 68).

Bairoch (1993: 68) estimates that in terms of value the West was about 94–96% self-sufficient in raw materials as late as 1913.

It is also extremely doubtful that the West needed some captive Third World or colonial market to achieve the industrial revolution.

As late as the early 20th century, the export sector accounted for only about 8–9% of GNP of most developed nations, and total exports to the Third World were as low as 1.3 to 1.7% of the total volume of production. Exports to actual Western colonial territories accounted for as little as 0.6 to 0.9% of the total volume of production (Bairoch 1993: 73).

Great Britain – the colonialist superpower of the 19th century – exported only about 4–6% of its total production (Bairoch 1993: 73), and not all of that to its colonies, a figure which remains a low percentage. At most, Bairoch notes, exports to the Third World might have helped certain given UK sectors for limited periods of time (such as textiles), but this hardly vindicates Marxism, since it does not follow at all that this was a necessary condition for the British industrial revolution nor that British imperialism had a fundamental and underlying economic motive.

A final point is that the Spanish and Portuguese had richer, larger colonial empires than Britain did in the early modern period, but why didn’t the Spanish and Portuguese undergo an industrial revolution? As late as the 1700s, the Spanish and Portuguese empires even had an export trade five to seven times larger than that of Britain’s empire (Bairoch 1993: 82).

Clearly, the possession of a colonial empire was not a sufficient condition for industrialisation, and, as we will see below, nor was it a necessary condition of the British industrial revolution. Rather, as Bairoch argues, the European conquest of the world occurred more as a consequence of the superior technology and wealth of Europeans (and power politics) which was in turn a result of industrialisation, not a condition for it (Bairoch 1993: 82, 85–86).

To return to Marx’s analysis, the system of public debt and central banks is seen by him as vital in the process of primitive accumulation:

“The system of public credit, i.e. of national debts, whose origin we discover in Genoa and Venice as early as the middle ages, took possession of Europe generally during the manufacturing period. The colonial system with its maritime trade and commercial wars served as a forcing-house for it. Thus it first took root in Holland. National debts, i.e., the alienation of the state—whether despotic, constitutional or republican—marked with its stamp the capitalistic era. The only part of the so-called national wealth that actually enters into the collective possessions of modern peoples is—their national debt. Hence, as a necessary consequence, the modern doctrine that a nation becomes the richer the more deeply it is in debt. Public credit becomes the credo of capital. And with the rise of national debt-making, want of faith in the national debt takes the place of the blasphemy against the Holy Ghost, which may not be forgiven.

The public debt becomes one of the most powerful levers of primitive accumulation. As with the stroke of an enchanter’s wand, it endows barren money with the power of breeding and thus turns it into capital, without the necessity of its exposing itself to the troubles and risks inseparable from its employment in industry or even in usury. The state-creditors actually give nothing away, for the sum lent is transformed into public bonds, easily negotiable, which go on functioning in their hands just as so much hard cash would. But further, apart from the class of lazy annuitants thus created, and from the improvised wealth of the financiers, middlemen between the government and the nation—as also apart from the tax-farmers, merchants, private manufacturers, to whom a good part of every national loan renders the service of a capital fallen from heaven—the national debt has given rise to joint-stock companies, to dealings in negotiable effects of all kinds, and to agiotage, in a word to stock-exchange gambling and the modern bankocracy.

At their birth the great banks, decorated with national titles, were only associations of private speculators, who placed themselves by the side of governments, and, thanks to the privileges they received, were in a position to advance money to the state. Hence the accumulation of the national debt has no more infallible measure than the successive rise in the stock of these banks, whose full development dates from the founding of the Bank of England in 1694. The Bank of England began with lending its money to the Government at 8%; at the same time it was empowered by Parliament to coin money out of the same capital, by lending it again to the public in the form of bank-notes. It was allowed to use these notes for discounting bills, making advances on commodities, and for buying the precious metals. It was not long ere this credit-money, made by the bank itself, became the coin in which the Bank of England made its loans to the state, and paid, on account of the state, the interest on the public debt. It was not enough that the bank gave with one hand and took back more with the other; it remained, even whilst receiving, the eternal creditor of the nation down to the last shilling advanced. Gradually it became inevitably the receptacle of the metallic hoard of the country, and the centre of gravity of all commercial credit. What effect was produced on their contemporaries by the sudden uprising of this brood of bankocrats, financiers, rentiers, brokers, stock-jobbers, &c, is proved by the writings of that time, e.g., by Bolingbroke’s.

With the national debt arose an international credit system, which often conceals one of the sources of primitive accumulation in this or that people. Thus the villanies of the Venetian thieving system formed one of the secret bases of the capital-wealth of Holland to whom Venice in her decadence lent large sums of money. So also was it with Holland and England. By the beginning of the 18th century the Dutch manufactures were far outstripped. Holland had ceased to be the nation preponderant in commerce and industry. One of its main lines of business, therefore, from 1701–1776, is the lending out of enormous amounts of capital, especially to its great rival England. The same thing is going on to-day between England and the United States. A great deal of capital, which appears to-day in the United States without any certificate of birth, was yesterday, in England, the capitalised blood of children.” (Marx 1906: 827–829).

Marx makes better remarks here, and his analysis of the origins of the financial system is not far from historical truth, as discussed in this post.

Marx sees the regressive taxes of the early modern period and 19th century as hitting the poor:

“As the national debt finds its support in the public revenue, which must cover the yearly payments for interest, &c, the modern system of taxation was the necessary complement of the system of national loans. The loans enable the government to meet extraordinary expenses, without the tax-payers feeling it immediately, but they necessitate, as a consequence, increased taxes. On the other hand, the raising of taxation caused by the accumulation of debts contracted one after another, compels the government always to have recourse to new loans for new extraordinary expenses. Modern fiscality, whose pivot is formed by taxes on the most necessary means of subsistence (thereby increasing their price), thus contains within itself the germ of automatic progression. Over-taxation is not an incident, but rather a principle. In Holland, therefore, where this system was first inaugurated, the great patriot, De Witt, has in his ‘Maxims’ extolled it as the best system for making the wage-labourer submissive, frugal, industrious, and overburdened with labour. The destructive influence that it exercises on the condition of the wage-labourer concerns us less however, here, than the forcible expropriation resulting from it, of peasants, artisans, and in a word, all elements of the lower middle-class. On this there are not two opinions, even among the bourgeois economists. Its expropriating efficacy is still further heightened by the system of protection, which forms one of its integral parts.” (Marx 1906: 829).

Protectionism is seen by Marx as crucial too:

“The system of protection was an artificial means of manufacturing manufacturers, of expropriating independent labourers, of capitalising the national means of production and subsistence, of forcibly abbreviating the transition from the mediaeval to the modern mode of production. The European states tore one another to pieces about the patent of this invention, and, once entered into the service of the surplus-value makers, did not merely lay under contribution in the pursuit of this purpose their own people, indirectly through protective duties, directly through export premiums. They also forcibly rooted out, in their dependent countries, all industry, as, e.g., England did with the Irish woollen manufacture. ….

Colonial system, public debts, heavy taxes, protection, commercial wars, &c, these children of the true manufacturing period, increase gigantically during the infancy of Modern Industry.” (Marx 1906: 830).

Marx goes on to point out how the developing cotton textile industry in England, even with increasing use of machines, needed to conscript pauper children as labour in the factories (Marx 1990: 922–924).

Marx points to the trans-Atlantic slave trade as yet another method by which the British accumulated capital (Marx 1990: 924–925).

But once again, in contrast to Marx’s anti-capitalist views, modern research has shown that the profits from slavery barely rose from 1% of national income in the late 17th century to 1.5% by 1770, and – even if this had been totally eliminated – there were vast amounts of money capital awash in the British economy in the 1700s which could have been used to finance industrial investment (Harley 2004: 197).

The contribution of the actual slave trade itself to Britain’s economy was trivial, and a significant volume of the trade occurred after the industrial take-off anyway (Eltis and Engerman 2000: 129). Moreover, the Spanish and Portuguese earned far more from the slave trade than the UK did in terms of a percentage of national income, but in neither case did profits from slavery lead to industrialisation in Spain or Portugal (Eltis and Engerman 2000: 131). On this issue, see here.

Nor is it true that industrial capitalism in England required slave-based production in the New World (Eltis and Engerman 2000: 134–135).

The reality is that the actual capital costs of the investment needed for the industrial revolution were not large at all compared to Britain’s GDP or the incomes of property owners (Harley 2004: 197).

Marx seems to imply that all these factors – colonialism, imperialism and slavery – were causally necessary for the industrial revolution in Europe:

“Tantae molis erat [sc. “so great was the effort”], to establish the ‘eternal laws of Nature’ of the capitalist mode of production, to complete the process of separation between labourers and conditions of labour, to transform, at one pole, the social means of production and subsistence into capital, at the opposite pole, the mass of the population into wage-labourers, into ‘free labouring poor,’ that artificial product of modern society. If money, according to Augier, ‘comes into the world with a congenital blood-stain on one cheek,’ capital comes dripping from head to foot, from every pore, with blood and dirt.” (Marx 1906: 833–834).

But, as we have seen, the historical evidence suggests otherwise and Marx was incorrect in attempting to see European imperialism as a necessary factor in capitalist development.

This is confirmed today by the way in which highly successful, state-led industrial revolutions have been carried out in South Korea and Taiwan, but we can see clearly that neither state had, nor required, colonies or imperial expansion or theft to effect this capitalist revolution.

Moreover, when the West itself gave up its colonial empires in the 1940s and 1950s and these former empires adopted a protectionist and state-led model of import substitution industrialisation, this did not stop massive economic growth and prosperity in the Western world.

Marx was, however, correct to note the role of protectionism and the state in early capitalist development and the crucial role of the credit system, with its emerging system of endogenous credit money.

A final point is that the non-Western world also has a long and horrific history of slavery, imperialism and colonialism. On the Marxist left and far left, there is an almost pathologically dishonest unwillingness to recognise that what the West did from 1500 to c. 1950 (in the period of its direct imperialism) was in essence what non-Western empire after empire has done through the ages, and in some respects not as bad as other empires. To blame capitalism per se for Western imperialism is short-sighted and the worst kind of Marxist mythology.

BIBLIOGRAPHY
Bairoch, Paul. 1993. Economics and World History: Myths and Paradoxes. Harvester Wheatsheaf, New York and London.

Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Eltis, David and Stanley L. Engerman. 2000. “The Importance of Slavery and the Slave Trade to Industrializing Britain,” The Journal of Economic History 60.1: 123–144.

Harley, C. Knick, 2004. “Trade: Discovery, Mercantilism and Technology,” in Roderick Floud and Paul Johnson (eds.), The Cambridge Economic History of Modern Britain. Volume 1: Industrialisation, 1700–1860. Cambridge University Press, Cambridge. 175–203.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Marx’s Capital, Volume 1, Chapter 30: A Critical Summary

Chapter 30 of volume 1 of Capital is called the “Impact of the Agricultural Revolution on Industry. Creation of the Home Market for Industrial Capital.”

Independent self-producing peasants in England were gradually driven off the land and into the cities to become an urban proletariat (Marx 1990: 908):

“With the setting free of a part of the agricultural population, therefore, their former means of nourishment were also set free. They were now transformed into material elements of variable capital. The peasant, expropriated and cast adrift, must buy their value in the form of wages, from his new master, the industrial capitalist. That which holds good of the means of subsistence holds with the raw materials of industry dependent upon home agriculture. They were transformed into an element of constant capital.” (Marx 1906: 817–818).

So the new factories came to produce what was once produced by “many small independent producers” (Marx 1906: 818).

The broad historical process was as follows:

“The expropriation and eviction of a part of the agricultural population not only set free for industrial capital, the labourers, their means of subsistence, and material for labour; it also created the home market.

In fact, the events that transformed the small peasants into wage-labourers, and their means of subsistence and of labour into material elements of capital, created, at the same time, a home-market for the latter. Formerly, the peasant family produced the means of subsistence and the raw materials, which they themselves, for the most part, consumed. These raw materials and means of subsistence have now become commodities; the large farmer sells them, he finds his market in manufactures. Yarn, linen, coarse woollen stuffs—things whose raw materials had been within the reach of every peasant family, had been spun and woven by it for its own use—were now transformed into articles of manufacture, to which the country districts at once served for markets. The many scattered customers, whom stray artizans until now had found in the numerous small producers working on their own account, concentrate themselves now into one great market provided for by industrial capital. Thus, hand in hand with the expropriation of the self-supporting peasants, with their separation from their means of production, goes the destruction of rural domestic industry, the process of separation between manufacture and agriculture. And only the destruction of rural domestic industry can give the internal market of a country that extension and consistence which the capitalist mode of production requires.” (Marx 1906: 819–820).

During the earlier “period of manufacture,” which for Marx was the period from the mid-16th to the late 18th centuries (Brewer 1984: 51), the transformation was only slow and incomplete (Marx 1990: 911).

It was large-scale industry which completed the process:

“Modern Industry alone, and finally, supplies, in machinery, the lasting basis of capitalistic agriculture, expropriates radically the enormous majority of the agricultural population, and completes the separation between agriculture and rural domestic industry, whose roots—spinning and weaving—it tears up. It therefore also, for the first time, conquers for industrial capital the entire home market.” (Marx 1906: 821).

So the creation of a large, property-less proletariat was a precondition for the development of capitalism (Brewer 1984: 81).

The destruction of the independent self-producing peasants turned them into workers who therefore needed to sell their labour-power as a commodity. At the same time, agricultural raw materials became commodities for capitalist production, and the food supply was now increasingly produced as capitalist commodities too, and the old household production was destroyed. Goods like textiles were now produced in a capitalist mode of production as well. A further important result of the whole process was the growth of domestic demand for commodities, which Marx calls the “home market” (Harvey 2010: 297).

As a minor point of interest, Marx mentions in a footnote the protectionist views of Henry Charles Carey against free-trade:

“But now comes Carey, and cries out upon England, surely not with unreason, that it is trying to turn every other country into a mere agricultural nation, whose manufacturer is to be England.” (Marx 1906: 821, n. 2).

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Marx’s Capital, Volume 1, Chapter 29: A Critical Summary

Chapter 29 of volume 1 of Capital is called “Genesis of the Capitalist Farmer” and argues that the true capitalist class in England emerged with the tenant capitalist farmers.

Marx explains the process:

“ … whence came the [sc. English] capitalists originally? For the expropriation of the agricultural population creates, directly, none by great landed proprietors. As far, however, as concerns the genesis of the farmer, we can, so to say, put our hand on it, because it is a slow process evolving through many centuries. The serfs, as well as the free small proprietors, held land under very different tenures, and were therefore emancipated under very different economic conditions. In England the first form of the farmer is the bailiff, himself a serf. His position is similar to that of the old Roman villicus, only in a more limited sphere of action. During the second half of the 14th century he is replaced by a farmer, whom the landlord provides with seed, cattle and implements. His condition is not very different from that of the peasant. Only he exploits more wage-labour. Soon he becomes a metayer, a half-farmer. He advances one part of the agricultural stock, the landlord the other. The two divide the total product in proportions determined by contract. This form quickly disappears in England, to give place to the farmer proper, who makes his own capital breed by employing wage-labourers, and pays a part of the surplus product, in money or in kind, to the landlord as rent. So long, during the 15th century, as the independent peasant and the farm-labourer working for himself as well as for wages, enriched themselves by their own labour, the circumstances of the farmer, and his field of production, were equally mediocre. The agricultural revolution which commenced in the last third of the 15th century, and continued during almost the whole of the 16th (excepting, however, its last decade), enriched him just as speedily as it impoverished the mass of the agricultural people.

The usurpation of the common lands allowed him to augment greatly his stock of cattle, almost without cost, whilst they yielded him a richer supply of manure for the tillage of the soil. To this, was added in the 16th century, a very important element. At that time the contracts for farms ran for a long time, often for 99 years. The progressive fall in the value of the precious metals, and therefore of money, brought the farmers golden fruit. Apart from all the other circumstances discussed above, it lowered wages. A portion of the latter was now added to the profits of the farm. The continuous rise in the price of corn, wool, meat, in a word of all agricultural produce, swelled the money capital of the farmer without any action on his part, whilst the rent he paid, (being calculated on the old value of money) diminished in reality. Thus they grew rich at the expense both of their labourers and their landlords. No wonder therefore, that England, at the end of the 16th century, had a class of capitalist farmers, rich, considering the circumstances of the time.” (Marx 1906: 814–816).

So this process, and the process described in Chapter 27, tended to destroy more and more free peasants and yeomanry, and created three great classes in the country-side as follows:

(1) the landlords (who were rentiers);

(2) the tenant farmers who were capitalists (and paying ground rent to their landlords), and

(3) the wage labourers.

The tenant-farmer capitalists emerged from the bailiffs or more successful peasants (Brewer 1984: 81).

Because of the price inflation of the 16th century, the real income of the tenant-farmer capitalists rose, so that they became a rich and more powerful class.

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Marx’s Capital, Volume 1, Chapter 28: A Critical Summary

Chapter 28 of volume 1 of Capital is called “Bloody Legislation against the Expropriated, from the End of the 15th Century. Forcing Down of Wages by Acts of Parliament.”

The creation of a vast new class of property-less proletarians as described in Chapter 27 presented immediate difficulties because there was not enough wage-labour to employ so many people (Marx 1990: 898):

“On the other hand, these men, suddenly dragged from their wanted mode of life, could not as suddenly adapt themselves to the discipline of their new condition. They were turned en masse into beggars, robbers, vagabonds, partly from inclination, in most cases from stress of circumstances. Hence at the end of the 15th and during the whole of the 16th century, throughout Western Europe a bloody legislation against vagabondage. The fathers of the present working-class were chastised for their enforced transformation into vagabonds and paupers. Legislation treated them as ‘voluntary’ criminals, and assumed that it depended on their own goodwill to go on working under the old conditions that no longer existed.” (Marx 1906: 806).

Marx surveys this legislation in England as follows:

(1) “Henry VIII. 1530: Beggars old and unable to work receive a beggar’s licence. On the other hand, whipping and imprisonment for sturdy vagabonds. They are to be tied to the cart-tail and whipped until the blood streams from their bodies, then to swear an oath to go back to their birthplace or to where they have lived the last three years and to ‘put themselves to labour.’ … In 27 Henry VIII. the former statute is repeated, but strengthened with new clauses. For the second arrest for vagabondage the whipping is to be repeated and half the ear sliced off ; but for the third relapse the offender is to be executed as a hardened criminal and enemy of the common weal” (Marx 1906: 806).

(2) “Edward VI.: A statute of the first year of his reign, 1547, ordains that if anyone refuses to work, he shall be condemned as a slave to the person who has denounced him as an idler. The master shall feed his slave on bread and water, weak broth and such refuse meat as he thinks fit He has the right to force him to do any work, no matter how disgusting, with whip and chains. If the slave is absent a fortnight, he is condemned to slavery for life and is to be branded on forehead or back with the letter S; if he runs away thrice, he is to be executed as a felon” (Marx 1906: 806).

(3) “Elizabeth, 1572: Unlicensed beggars above 14 years of age are to be severely flogged and branded on the left ear unless some one will take them into service for two years; in case of a repetition of the offence, if they are over 18, they are to be executed, unless some one will take them into service for two years; but for the third offence they are to be executed without mercy as felons.” (Marx 1906: 807).

(4) “James I: Any one wandering about and begging is declared a rogue and a vagabond. Justices of the peace in petty sessions are authorised to have them publicly whipped and for the first offence to imprison them for 6 months, for the second for 2 years. Whilst in prison they are to be whipped as much and as often as the justices of the peace think fit . . . Incorrigible and dangerous rogues are to be branded with an E, on the left shoulder and set to hard labour, and if they are caught begging again, to be executed without mercy. These statutes, legally binding until the beginning of the 18th century, were only repealed by 12 Ann, c. 23.” (Marx 1906: 807–808).

The process proceeded as follows:

“Thus were the agricultural people, first forcibly expropriated from the soil, driven from their homes, turned into vagabonds, and then whipped, branded, tortured by laws grotesquely terrible, into the discipline necessary for the wage system.

It is not enough that the conditions of labour are concentrated in a mass, in the shape of capital, at the one pole of society, while at the other are grouped masses of men, who have nothing to sell but their labour-power. Neither is it enough that they are compelled to sell it voluntarily. The advance of capitalist production develops a working-class, which by education, tradition, habit, looks upon the conditions of that mode of production as self-evident laws of nature. The organization of the capitalist process of production, once fully developed, breaks down all resistance. The constant generation of a relative surplus-population keeps the law of supply and demand of labour, and therefore keeps wages, in a rut that corresponds with the wants of capital. The dull compulsion of economic relations completes the subjection of the labourer to the capitalist. Direct force, outside economic conditions, is of course still used, but only exceptionally. In the ordinary run of things, the labourer can be left to the ‘natural laws of production,’ i.e., to his dependence on capital, a dependence springing from, and guaranteed in perpetuity by, the conditions of production themselves.” (Marx 1906: 808–809).

It is interesting here to note Marx’s view of wages in capitalism:

“The constant generation of a relative surplus population keeps the law of the supply and demand of labour, and therefore wages, within narrow limits which correspond to capital’s valorization requirements.” (Marx 1990: 899).

The narrow limits, as Marx explains in Chapter 25 and elsewhere, are around the subsistence wage, the value of the maintenance and reproduction of labour power.

But, in the early stages of capitalism, there was no such equilibrium process to control wages and workers, and so capitalists needed state power to do so:

“It is otherwise during the historic genesis of capitalist production. The bourgeoisie, at its rise, wants and uses the power of the state to ‘regulate’ wages, i.e., to force them within the limits suitable for surplus-value making, to lengthen the working-day and to keep the labourer himself in the normal degree of dependence. This is an essential element of the so-called primitive accumulation.

The class of wage-labourers, which arose in the latter half of the 14th century, formed then and in the following century only a very small part of the population, well protected in its position by the independent peasant proprietary in the country and the guild-organization in the town. In country and town master and workman stood close together socially. The subordination of labour to capital was only formal—i.e., the mode of production itself had as yet no specific capitalistic character. Variable capital preponderated greatly over constant. The demand for wage-labour grew, therefore, rapidly with every accumulation of capital, whilst the supply of wage-labour followed but slowly. A large part of the national product, changed later into a fund of capitalist accumulation, then still entered into the consumption fund of the labourer.

Legislation on wage-labour, (from the first, aimed at the exploitation of the labourer and, as it advanced, always equally hostile to him), is started in England by the Statute of Labourers, of Edward III., 1349. The ordinance of 1350 in France, issued in the name of King John, corresponds with it. English and French legislation run parallel and are identical in purport. So far as the labour-statutes aim at compulsory extension of the working-day … .” (Marx 1906: 809–810).

These laws fixed a scale of wages and punished the payment of wages higher than the legal limit (Marx 1990: 901).

Organised labour was also made illegal:

“All combinations, contracts, oaths, &c., by which masons and carpenters reciprocally bound themselves, were declared null and void. Coalition of the labourers is treated as a heinous crime from the 14th century to 1825, the year of the repeal of the laws against Trades' Unions. The spirit of the Statute of Labourers of 1349 and of its offshoots, comes out clearly in the fact, that indeed a maximum of wages is dictated by the State, but on no account a minimum.” (Marx 1906: 810–811).

Such laws to regulate wages and to forbid workers’ combinations were re-issued in the 16th and 18th centuries (Marx 1990: 901–902).

Eventually, some of these laws were repealed, but Marx thought that even in the late 19th century British law still inhibited trade union activity:

“Finally, in 1813, the laws for the regulation of wages were repealed. They were an absurd anomaly, since the capitalist regulated his factory by his private legislation, and could by the poor-rates make up the wage of die agricultural labourer to the indispensable minimum. The provisions of the labour statutes as to contracts between master and workman, as to giving notice and the like, which only allows of a civil action against the contract-breaking master, but on the contrary permit a criminal action against the contract-breaking workman, are to this hour (1873) in full force. The barbarous laws against Trades’ Unions fell in 1825 before the threatening bearing of the proletariat. Despite this, they fell only in part. Certain beautiful fragments of the old statute vanished only in 1859. Finally, the act of Parliament of June 29, 1871, made a pretence of removing the last traces of this class of legislation by legal recognition of Trades Unions. But an act of Parliament of the same date (an act to amend the criminal law relating to violence, threats, and molestation), re-established, in point of fact, the former state of things in a new shape. By this Parliamentary escamotage the means which the labourers could use in a strike or lock-out were withdrawn from the laws common to all citizens, and placed under exceptional penal legislation, the interpretation of which fell to the masters themselves in their capacity as justices of the peace. Two years earlier, the same House of Commons and the same Mr. Gladstone in the well-known straightforward fashion brought in a bill for the abolition of all exceptional penal legislation against the working-class. But this was never allowed to go beyond the second reading, and the matter was thus protracted until at last the ‘great Liberal party,’ by an alliance with the Tories, found courage to turn against the very proletariat that had carried it into power. Not content with this treachery, the ‘great Liberal party’ allowed the English judges, ever complaisant in the service of the ruling classes, to dig up again the earlier laws against ‘conspiracy,’ and to apply them to coalitions of labourers. We see that only against its will and under the pressure of the masses did the English Parliament give up the laws against Strikes and Trades’ Unions, after it had itself, for 500 years, held, with shameless egoism, the position of a permanent Trades’ Union of the capitalists against the labourers.” (Marx 1906: 812–813).

Despite Marx’s negative views on the ability of trade unions to organise under 19th century laws, the fact remains that organised labour became more and more powerful under capitalism.

A major economic phenomenon that Marx badly missed was the increasing downwards nominal wage rigidity in the later 19th century.

For example, Hanes (1993) concludes that 19th century American nominal wages had already become relatively inflexible by the 1890s (Hanes 1993: 733–734).

This development was not so much the consequence of organised, formal trade union activity, because, generally speaking, US trade unions were weak in the late 19th century in terms of numbers and membership, and they faced hostility from the courts and government, and even when they existed they could not generally create binding legal employment contracts with employers, because the courts did not recognise them (Hanes 1993: 750–751).

But the informal organised labour activity still had a powerful effect. Hanes (1993: 751) contends that strikes were still a widespread phenomenon amongst non-unionised workers, and that the spread of large-scale manufacturing firms with large masses of workers was, paradoxically, a major factor that allowed informal labour organisation and industrial strife: eventually industrial capitalists decided it was too costly to regularly reduce money wages in recessions, and so increasing money wage rigidity was accepted by private firms (Hanes 1993: 733–734). A similar phenomenon probably happened in Britain.

But, once again, Marx missed this trend and the reality of rising real wages in 19th century capitalism.

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Hanes, Christopher. 1993. “The Development of Nominal Wage Rigidity in the Late 19th Century,” The American Economic Review 83.4: 732–756.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Marx’s Capital, Volume 1, Chapter 27: A Critical Summary

Chapter 27 of volume 1 of Capital is called “The Expropriation of the Agricultural Population from the Land” and examines the early history of the establishment of capitalism in England by the privatisation of communal property.

Marx sketches the social and economic history of the later Middle Ages in England:

“In England, serfdom had practically disappeared in the last part of the 14th century. The immense majority of the population consisted then, and to a still larger extent, in the 15th century, of free peasant proprietors, whatever was the feudal title under which their right of property was hidden. In the larger seignorial domains, the old bailiff, himself a serf, was displaced by the free farmer. The wage-labourers of agriculture consisted partly of peasants, who utilised their leisure time by working on the large estates, partly of an independent special class of wage-labourers, relatively and absolutely few in numbers. The latter also were practically at the same time peasant farmers, since, besides their wages, they had alloted to them arable land to the extent of 4 or more acres, together with their cottages. Besides they, with the rest of the peasants, enjoyed the usufruct of the common land, which gave pasture to their cattle, furnished them with timber, fire-wood, turf, &c.” (Marx 1906: 788).

“The prelude of the revolution that laid the foundation of the capitalist mode of production, was played in the last third of the 15th, and the first decade of the 16th century. A mass of free proletarians was hurled on the labour-market by the breaking-up of the bands of feudal retainers ... Although the royal power, itself a product of bourgeois development, in its strife after absolute sovereignty forcibly hastened on the dissolution of these bands of retainers, it was by no means the sole cause of it. In insolent conflict with king and parliament, the great feudal lords created an incomparably larger proletariat by the forcible driving of the peasantry from the land, to which the latter had the same feudal right as the lord himself, and by the usurpation of the common lands. The rapid rise of the Flemish wool manufactures, and the corresponding rise in the price of wool in England, gave the direct impulse to these evictions. The old nobility had been devoured by the great feudal wars. The new nobility was the child of its time, for which money was the power of all powers. Transformation of arable land into sheep-walks was, therefore, its cry. ... .” (Marx 1906: 789–790).

Henry VII attempted to limit enclosures and protect the free yeomanry (Marx 1990: 879–880), but this was not what capitalism needed:

“What the capital system demanded was, on the other hand, a degraded and almost servile condition of the mass of the people, the transformation of them into mercenaries, and of their means of labour into capital. (Marx 1906: 791–792).

The process of forcible expropriation of the people received in the 16th century a new and frightful impulse from the Reformation, and from the consequent colossal spoliation of the church property. The Catholic church was, at the time of the Reformation, feudal proprietor of a great part of the English land. The suppression of the monasteries, &c, hurled their inmates into the proletariat. The estates of the church were to a large extent given away to rapacious royal favourites, or sold at a nominal price to speculating farmers and citizens, who drove out, en masse, the hereditary sub-tenants and threw their holdings into one. The legally guaranteed property of the poorer folk in a part of the church’s tithes was tacitly confiscated. ‘Pauper ubique jacet,’ cried Queen Elizabeth, after a journey through England. In the 43rd year of her reign the nation was obliged to recognise pauperism officially by the introduction of a poor-rate. ‘The authors of this law seem to have been ashamed to state the grounds of it, for [contrary to traditional usage] it has no preamble whatever.’ By the 16th of Charles L, ch. 4, it was declared perpetual, and in fact only in 1834 did it take a new and harsher form. These immediate results of the Reformation were not its most lasting ones. The property of the church formed the religious bulwark of the traditional conditions of landed property. With its fall these were no longer tenable.

Even in the last decade of the 17th century, the yeomanry, the class of independent peasants, were more numerous than the class of farmers. ... About 1750, the yeomanry had disappeared, and so had, in the last decade of the 18th century, the last trace of the common land of the agricultural labourer.” (Marx 1906: 792–794).

“After the restoration of the Stuarts, the landed proprietors carried, by legal means, an act of usurpation, effected everywhere on the Continent without any legal formality. They abolished the feudal tenure of land, i.e., they got rid of all its obligations to the State, ‘indemnified’ the State by taxes on the peasantry and the rest of the mass of the people, vindicated for themselves the rights of modern private property in estates to which they had only a feudal title, and, finally, passed those laws of settlement, which, mutatis mutandis, had the same effect on the English agricultural labourer, as the edict of the Tartar Boris Godunof on the Russian peasantry.

The ‘glorious Revolution’ brought into power, along with William of Orange, the landlord and capitalist appropriators of surplus-value. They inaugurated the new era by practising on a colossal scale thefts of state lands, thefts that had been hitherto managed more modestly. These estates were given away, sold at a ridiculous figure, or even annexed to private estates by direct seizure. All this happened without the slightest observation of legal etiquette. The crown lands thus fraudulently appropriated, together with the robbery of the Church estates, as far as these had not been lost again during the republican revolution, form the basis of the to-day princely domains of the English oligarchy. The bourgeois capitalists favoured the operation with the view, among others, to promoting free trade in land, to extending the domain of modern agriculture on the large farm-system, and to increasing their supply of the free agricultural proletarians ready to hand. Besides, the new landed aristocracy was the natural ally of the new bankocracy, of the newly-hatched haute finance, and of the large manufacturers, then depending on protective duties. The English bourgeoisie acted for its own interest quite as wisely as did the Swedish bourgeoisie who, reversing the process, hand in hand with their economic allies, the peasantry, helped the kings in the forcible resumption of the Crown lands from the oligarchy. This happened since 1604 under Charles X. and Charles XI.

Communal property—always distinct from the State property just dealt with—was an old Teutonic institution which lived on under cover of feudalism. We have seen how the forcible usurpation of this, generally accompanied by the turning of arable into pasture land, begins at the end of the 15th and extends into the 16th century. But, at that time, the process was carried on by means of individual acts of violence against which legislation, for a hundred and fifty years, fought in vain. The advance made by the 18th century shows itself in this, that the law itself becomes now the instrument of the theft of the people's land, although the large farmers make use of their little independent methods as well. The parliamentary form of the robbery is that of Acts for enclosures of Commons, in other words, decrees by which the landlords grant themselves the people’s land as private property, decrees of expropriation of the people.” (Marx 1906: 794–796).

“Whilst the place of the independent yeoman was taken by tenants at will, small farmers on yearly leases, a servile rabble dependent on the pleasure of the landlords, the systematic robbery of the Communal lands helped especially, next to the theft of the State domains, to swell those large farms, that were called in the 18th century capital farms or merchant farms, and to ‘set free’ the agricultural populations as proletarians for manufacturing industry.” (Marx 1906: 796).

The enclosures and transformation of the yeomanry into agricultural labourers, Marx maintains, caused their wages to fall, and often below subsistence levels so that they had to rely on the Poor law relief (Marx 1990: 888).

Marx states that by “the 19th century, the very memory of the connexion between the agricultural labourer and the communal property had, of course, vanished” (Marx 1906: 800).

The last manifestation of this theft of communal property was the “clearing” of the new private property of its people (Marx 1906: 800).

Marx refers to the Scottish highland clearances as the last major and brutal instance of this:

“The last process of wholesale expropriation of the agricultural population from the soil is, finally, the so-called clearing of estates, i.e., the sweeping men off them. All the English methods hitherto considered culminated in ‘clearing.’ As we saw in the picture of modern conditions given in a former chapter, where there are no more independent peasants to get rid of, the ‘clearing’ of cottages begins; so that the agricultural labourers do not find on the soil cultivated by them even the spot necessary for their own housing. But what ‘clearing of estates’ really and properly signifies, we learn only in the promised land of modern romance, the Highlands of Scotland. There the process is distinguished by its systematic character, by the magnitude of the scale on which it is carried out at one blow (in Ireland landlords have gone to the length of sweeping away several villages at once; in Scotland areas as large as German principalities are dealt with), finally by the peculiar form of property, under which the embezzled lands were held.

The Highland Celts were organised in clans, each of which was the owner of the land on which it was settled. The representative of the clan, its chief or ‘great man,’ was only the titular owner of this property, just as the Queen of England is the titular owner of all the national soil. When the English government succeeded in suppressing the intestine wars of these ‘great men,’ and their constant incursions into the Lowland plains, the chiefs of the clans by no means gave up their time-honoured trade as robbers; they only changed its form. On their own authority they transformed their nominal right into a right of private property, and as this brought them into collision with their clansmen, resolved to drive them out by open force.” (Marx 1906: 800–801).

Finally, Marx sums up the process:

“The spoliation of the church’s property, the fraudulent alienation of the State domains, the robbery of the common lands, the usurpation of feudal and clan property, and its transformation into modern private property under circumstances of reckless terrorism, were just so many idyllic methods of primitive accumulation. They conquered the field for capitalistic agriculture, made the soil part and parcel of capital, and created for the town industries the necessary supply of a ‘free’ and outlawed proletariat.” (Marx 1906: 805).

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.

Marx’s Capital, Volume 1, Chapter 26: A Critical Summary

This chapter begins Part 8 of Capital called “So-Called Primitive Accumulation” (comprising Chapters 26, 27, 28, 29, 30, 31, 32, and 33).

Chapter 26 of volume 1 of Capital is called “The Secret of Primitive Accumulation” and examines how capital was first accumulated before surplus value. In other words, this looks at the historical process by which feudalism was transformed into capitalism, and how peasants were stripped of any means of production and made into free wage-labourers.

Money and commodities per se do not function as capital, but need to be transformed into capital (Marx 1990: 874).

It is important to remember Marx’s definition of “capital” in this context. For Marx, money (M) in the formula M–C–M′ (where M′ = money plus an increment), describing the capitalist mode of production, is defined as capital (Marx 1990: 250). As Marx says, there is “a palpable difference between the circulation of money as capital, and its circulation as mere money” (Marx 1906: 166). Capital is a type of “value in motion” that is used by capitalists to create more value, but the “value in motion” can appear in the form of either money or commodities (Harvey 2010: 90). So, for Marx, capital is money or commodities (both with embodied labour value) used to create more value by employing labour-power to produce commodities, and in the process involving the extraction of surplus-value. That is, capital is a certain sum of value repeatedly “being transformed from money to commodities and back again” to produce more value (Brewer 1984: 35).

Marx explains:

“In themselves, money and commodities are no more capital than are the means of production and of subsistence. They want transforming into capital. But this transformation itself can only take place under certain circumstances that centre in this, viz., that two very different kinds of commodity-possessors must come face to face and into contact; on the one hand, the owners of money, means of production, means of subsistence, who are eager to increase the sum of values they possess, by buying other people's labour-power; on the other hand, free labourers, the sellers of their own labour-power, and therefore the sellers of labour. Free labourers, in the double sense that neither they themselves form part and parcel of the means of production, as in the case of slaves, bondsmen, &c, nor do the means of production belong to them, as in the case of peasant-proprietors; they are, therefore, free from, unencumbered by, any means of production of their own. With this polarisation of the market for commodities, the fundamental conditions of capitalist production are given. The capitalist system presupposes the complete separation of the labourers from all property in the means by which they can realise their labour. As soon as capitalist production is once on its own legs, it not only maintains this separation, but reproduces it on a continually extending scale. The process, therefore, that clears the way for the capitalist system, can be none other than the process which takes away from the labourer the possession of his means of production; a process that transforms, on the one hand, the social means of subsistence and of production into capital, on the other, the immediate producers into wage-labourers. The so-called primitive accumulation, therefore, is nothing else than the historical process of divorcing the producer from the means of production. It appears as primitive, because it forms the pre-historic stage of capital and of the mode of production corresponding with it.” (Marx 1906: 785–786).

In Chapter 4 of Capital, however, Marx stated the following:

“As a matter of history, capital, as opposed to landed property, invariably takes the form at first of money; it appears as moneyed wealth, as the capital of the merchant and of the usurer. But we have no need to refer to the origin of capital in order to discover that the first form of appearance of capital is money. We can see it daily under our very eyes. All new capital, to commence with, comes on the stage, that is, on the market, whether of commodities, labour, or money, even in our days, in the shape of money that by a definite process has to be transformed into capital.” (Marx 1906: 163–164).

First, Marx’s belief that capitalism will continue to create proletarians on a “continually extending scale” is also consistent with his prediction that the working class will continue to grow and grow until the collapse of capitalism (though this did not happen, as the working class as a class stabilised and the middle class became larger and larger).

Secondly, early Western European capitalism began with merchants in long distance trade and banking.

But, in other passages (despite the one above) in Capital, Marx does not regard early merchants and usurers as proper capitalists.

In Chapter 5, Marx states that “merchants’ capital and interest-bearing capital are derivative forms, and at the same time … these two forms appear in the course of history before the modern standard form of capital” (Marx 1906: 183).

But, since the business activities of merchants only take place “within the sphere of circulation” (Marx 1906: 182) and “surplus-value cannot be created by circulation” (Marx 1906: 183), merchants do not create surplus value and cannot be true capitalists in Marx’s sense of this term.

For example, if a merchant capitalist buys commodities for $100 and sells them for $110 has he created surplus value by his labour? (Engels, for instance, once proposed a question similar to this one to Marx.) It would seem that Marx merely thinks that the initial $100 is only “circulating money capital” and any surplus obtained in this way is done so “by trickery, or by speculation on the oscillation of commodity prices” (letter, Marx to Engels, London, 30 April 1868; elsewhere Marx sees gambling in a comparable way). Though the transaction can be explained as M–C–M′, the value is not created by the labour power of the merchant or speculator, but can only be created by labour-power engaged in capitalist production.

Marx, then, cannot think that, say, medieval Italian merchant traders were real capitalists.

This is confirmed in Chapter 16:

“It will suffice merely to refer to certain intermediate forms, in which surplus-labour is not extorted by direct compulsion from the producer, nor the producer himself yet formally subjected to capital. In such forms capital has not yet acquired the direct control of the labour-process. By the side of independent producers who carry on their handicrafts and agriculture in the traditional old-fashioned way, there stands the usurer or the merchant, with his usurer’s capital or merchant’s capital, feeding on them like a parasite. The predominance, in a society, of this form of exploitation excludes the capitalist mode of production; to which mode, however, this form may serve as a transition, as it did towards the close of the Middle Ages. Finally, as is shown by modern ‘domestic industry,’ some intermediate forms are here and there reproduced in the background of Modern Industry, though their physiognomy is totally changed.” (Marx 1906: 559–560).

So here banks, moneylenders and merchant traders are not productive capitalists, but parasites. Their “form of exploitation” was just a “transition” to the modern “capitalist mode of production.”

Because of his mystical labour theory of value, this is another gaping hole in Marx’s theory. Early accumulation of money partly for investment was undoubted linked to merchants and banking to some extent, who can legitimately be regarded as capitalists.

Capitalism, for Marx, grew out of feudalism and there was an historical transformation from feudalism to capitalism:

“The economic structure of capitalistic society has grown out of the economic structure of feudal society. The dissolution of the latter set free the elements of the former.

The immediate producer, the labourer, could only dispose of his own person after he had ceased to be attached to the soil and ceased to be the slave, serf, or bondman of another. To become a free seller of labour-power, who carries his commodity wherever he finds a market, he must further have escaped from the regime of the guilds, their rules for apprentices and journeymen, and the impediments of their labour regulations. Hence, the historical movement which changes the producers into wage-workers, appears, on the one hand, as their emancipation from serfdom and from the fetters of the guilds, and this side alone exists for our bourgeois historians. But, on the other hand, these new freedmen became sellers of themselves only after they had been robbed of all their own means of production, and of all the guarantees of existence afforded by the old feudal arrangements. And the history of this, their expropriation, is written in the annals of mankind in letters of blood and fire.

The industrial capitalists, these new potentates, had on their part not only to displace the guild masters of handicrafts, but also the feudal lords, the possessors of the sources of wealth. In this respect their conquest of social power appears as the fruit of a victorious struggle both against feudal lordship and its revolting prerogatives, and against the guilds and the fetters they laid on the free development of production and the free exploitation of man by man. ….

The starting-point of the development that gave rise to the wage-labourer as well as to the capitalist, was the servitude of the labourer. The advance consisted in a change of form of this servitude, in the transformation of feudal exploitation into capitalist exploitation. To understand its march, we need not go back very far. Although we come across the first beginnings of capitalist production as early as the 14th or 15th century, sporadically, in certain towns of the Mediterranean, the capitalistic era dates from the 16th century. Wherever it appears, the abolition of serfdom has been long effected, and the highest development of the middle ages, the existence of sovereign towns, has been long on the wane. In the history of primitive accumulation, all revolutions are epoch-making that act as levers for the capitalist class in course of formation; but, above all, those moments when great masses of men are suddenly and forcibly torn from their means of subsistence, and hurled as free and ‘unattached’ proletarians on the labour market. The expropriation of the agricultural producer, of the peasant, from the soil, is the basis of the whole process. The history of this expropriation, in different countries, assumes different aspects, and runs through its various phases in different orders of succession, and at different periods. In England alone, which we take as our example, has it the classic form.” (Marx 1906: 786–787).

So this is how the labour-power of people became a commodity.

Marx dates capitalism from the 16th century, and sees the “expropriation of the agricultural producer” as the fundamental basis of capitalism.

There is also a very profound insight that can be drawn from this Chapter of Capital, but it never occurred to Marx: if in the early history of capitalism very brutal and coercive polices were necessary to create an industrial proletariat and class of people who accumulate sufficient levels of capital for industrialisation, how can communism in the Third World trying to effect industrialisation escape such brutality as well?

In fact, that is actually what happened in communist countries engaged in forced industrialisation of largely backward agrarian economies, as in the Soviet Union: extremely brutal state violence and coercion to create a proletariat and enough accumulation of capital.

If capitalism’s early history of accumulation and the creation of a class of labourers was brutal, then so was that of communism!

Arguably, it was more so: the history of communism is also “written in the annals of mankind in letters of blood and fire,” but to an even worse extent. We see that history in Stalin’s Five-Year Plans, the forced collectivisation, the theft of the agricultural surplus through the forced collectivisation, the driving of Russian peasants to the towns, and the Soviet famine of 1932–1933. And that is before we get to the brutal consequences and abuses of the authoritarianism and totalitarianism that communist transitional states inevitably descended into.

Even if one were to construe capitalism as a “disease,” history shows us that the communist “cure” was worse than the disease.

Finally, in some respects, Marx really needed capitalism, because the full development of a capitalist society was the necessary precondition for a transitional communist state leading to stateless communism.

So in that respect, for Marx, capitalism has a vital and necessary historical role and was a necessary stage of history, and so whatever coercive, exploitative factors needed for its establishment and complete development were also historically necessary. This can be seen in Marx’s remarks on the transition to capitalism in India wrought by the British empire:

“... we must not forget that these idyllic [sc. Indian] village-communities, inoffensive though they may appear, had always been the solid foundation of Oriental despotism, that they restrained the human mind within the smallest possible compass, making it the unresisting tool of superstition, enslaving it beneath traditional rules, depriving it of all grandeur and historical energies. ....

England, it is true, in causing a social revolution in Hindostan, was actuated only by the vilest interests, and was stupid in her manner of enforcing them. But that is not the question. The question is, can mankind fulfil its destiny without a fundamental revolution in the social state of Asia? If not, whatever may have been the crimes of England she was the unconscious tool of history in bringing about that revolution.”
Marx, Karl. 1853. “The British Rule in India,” New York Daily Tribune, June 25, 1853.
https://www.marxists.org/archive/marx/works/1853/06/25.htm

BIBLIOGRAPHY
Brewer, Anthony. 1984. A Guide to Marx’s Capital. Cambridge University Press, Cambridge.

Harvey, David. 2010. A Companion to Marx’s Capital. Verso, London and New York.

Marx, Karl. 1906. Capital. A Critique of Political Economy (vol. 1; rev. trans. by Ernest Untermann from 4th German edn.). The Modern Library, New York.

Marx, Karl. 1990. Capital. A Critique of Political Economy. Volume One (trans. Ben Fowkes). Penguin Books, London.