An Intro to the Marxist Analysis of Capitalist Production

Marx’s economic analysis of capitalism is simultaneously what he is best known for, and yet also the least-known aspect of his economic analysis. The average person is typically unaware of the Labor Theory of Value (LTV), or what exactly it entails, and if they are, they have been taught a distorted version created by anti-Marxists for greater ease of debunking Marxian economics. This, plus a simplified, liberalized understanding of Marx’s theory of alienation, as well as a false portrayal of him advocating absolute equality as the solution to capitalist exploitation, tends to be as far as popular knowledge of Marxism goes. What our purpose here is to provide an introductory work in Marxist economics, and to dispel myths about Marx’s method of analysis.

Before we start, it is important to remember that the first part of this will be examining Marx’s analysis of the laws and relations of the capitalist mode of production (defined as the system of production and associated social relations), not modes of production across history. To begin, let’s jump into a discussion of the basics of value. A commodity has two value-forms. Marx divided these into use-value and exchange-value. Use-value is not necessarily equivalent to usefulness, or the ability of an item to satisfy a particular need. Usefulness can exist without a commodity-form. Use-value, however, is usefulness as expressed for a commodity. As Marx says in Capital Volume One:

A use-value does not necessarily need to satisfy the bare needs of life, the means of subsistence (i.e. food, water, shelter, etc), in order to be considered “useful”. A social need is not merely the need to satisfy means of subsistence. A social need is determined by the structure of a given society. If there is a social need for batteries in toys, created by the common practice of giving battery-operated toys for children, then batteries are given use-value. If there is a social need for tobacco for spiritual practices, then tobacco is given a use-value.

Having established the parameters of use-value, we have reached the point where we must delve into exchange-value. In the aforementioned text, Marx says of it and its relation to use-value:

Exchange-value is essentially the value of a commodity relative to another commodity, expressed in terms of that other commodity. In explaining exchange-value, Marx has identified its characteristic as expressing not a commodity’s use value per se, which is merely what makes it salable in the first place, but the socially necessary labor-time embodied in it. In short, the means of evaluating disparate commodities together in exchanging them is to evaluate the socially necessary labor-time embodied in them. What is socially necessary labor-time defined as? From The Poverty of Philosophy by Marx:

So, unlike what many anti-Marxists claim, Marx did not say that a commodity’s value is merely the equivalent of the specific labor-time embodied in its process, but the minimum average, or socially necessary, labor-time taken to produce it. Further, he did not say that a commodity’s value is the cost of labor in its production, or even the cost of all the factors of production, but that will be dealt with later. Money is a universal means of exchange for commodities, a standard for expressing their exchange-values relative to each other. Prices do not always correspond to things real exchange-values, but this is something we will, again, deal with later.

For now, before we leave exchange-value, let’s get into what the obscuring of use-value and even the labor process embodied in a commodity, which Marx discussed in the previous excerpt from Capital, represents in terms of social attitudes toward commodities. Commodity fetishism is Marx’s term for the phenomenon wherein people presume value to be inherent to commodities, as something they merely arise with. He identifies this as arising from commodity exchange in saying, in Capital Volume One:

This is the commodity-fetishist view of value, that it is inherent. And yet, as Marx points out in the aforementioned text:

It is ridiculous to think that exchange-value is something inherent, or even use-value as a whole. Value is an expression of social relations. Use-value is not inherent and unchanging, the usefulness of a commodity-form change in accordance with changes in social relations and modes of production. What use were fossil fuels to humans before they could harvest them and put them to use in industrial production? They had no usefulness, and so could not become commodities, at least not by that use-value. Now that they have use-value, they can also have exchange-value, and be compared to other commodities’ values through exchange. This exchange does not fall from the sky, however. It is an expression of social relations, specifically social production; large groups of people cooperating in the production of something. Its exchange-value is the socially necessary labor-time embodied in it, which itself is not even unchanging, as improvements in the harvesting and refinement of fossil fuels decreases its value by decreasing the socially necessary labor-time embodied in it. The social relations behind value, however, are obscured by the minds of those engaging in commodity production and exchange, it appears merely to be natural, inherent. Let’s say 1 basket has a value equivalent to 3 combs. To the commodity fetishist perspective, this is merely due to the inherent values of each, not due to the basket taking 3 times the socially necessary labor-time to produce as that of a single comb.

So, if a commodity’s exchange-value is an expression of the socially necessary labor-time embodied in it, does all labor have value? No. Value, as mentioned previously, is representative of very particular social relations, of commodity production, production for exchange rather than direct consumption. When a peasant living in a society without significant commodity production grows, say, wheat for the direct consumption of themselves and their family, the labor they put into raising and harvesting that wheat has no value. They do not enter into social relations with other producers in the production of their wheat, and so it is sans-value. Labor itself does not in and of itself have value, and this is why we Marxists object to the phrase “the worker sells their labor to the capitalist.” Labor is the capacity to engage in production, a worker does not sell this capacity to the capitalist to be used for all time and in all manners. However, labor can take a form which has value: labor-power. Labor-power is the commodity form of labor, it is the sale of a worker’s labor capacity for a definite period of time and in a definite manner. The sale of one’s labor-power in exchange for payment as compensation to that time period and manner is wage-labor. If our peasant growing wheat for themselves is transformed into a farmhand working for a capitalist, then they become a wage-laborer who sells their labor-power. Their labor has a definite value, as they are producing a commodity rather than merely means of subsistence to be used for direct immediate consumption. Having identified the form of labor that has value, we come to a place where we can delve into the most important of Marx’s discoveries: surplus-value.

Wages are not always, and are almost never, equivalent to the value of labor-power. For this example, we will pretend as if they are, in order to more easily demonstrate the process at hand. We will also assume an average rate of productivity for ease. Let’s say a firm’s workers are paid $10 per hour, assuming that their labor-power for each hour is equivalent to an exchange-value expressed as $10 per hour. This means that for every hour, they each expend a certain amount of socially necessary labor-time corresponding to a $10 value. Now, the workers are to be given about 30 hours of work per week, giving them a $300 weekly paycheck. In this scenario, while the workers are being paid for all of their labor-time, there is nothing left for the bourgeoisie. The necessary labor-time, the time in production it takes to reproduce the value expended on the workers’ wages (essentially how much it takes to ensure the reproduction of their labor-capacity), is here the 30 hours. In order to turn a profit, the capitalist must increase their labor-time beyond their necessary labor-time. In this case, we’ll say he increases it to a 40 hour work week, with no increase in the rate of wages. Now, the workers’ labor-power produces an equivalent of $400 per week, being paid $300 per week, leaving us with a surplus-value of $100 per week, which is appropriated by the capitalist. Surplus labor-time is unpaid labor-time, surplus-value represents unpaid labor-power. This surplus labor-time, beyond the necessary labor-time, is not literally in the extra hours added, but is there in the mass, in the rate of variables at hand. If a worker labors 8 hours, with the first 5 hours reproducing the equivalent of their necessary labor-time, the first 5 hours do not literally go to paying for their wages and the next 3 hours to surplus-value. It is the fractions that matter here. It is important to note that wages are not fixed by the capitalist arbitrarily, the lowest wages can be made and still have the supply of labor-power available is at the minimum necessary for the worker to purchase their means of subsistence. Capitalists do not always fix wages this low, though some may falsely claim Marx said this, and can be raised, for example, in order to encourage productivity or loyalty among workers, as with Ford in the early 20th century. Further, the capitalist does not pocket all of the surplus-value, for their personal consumption or as profit. The surplus-value is broken into a fund for upkeep of the means of production (to be explained later), a fund for expenditure on raw materials, a fund for insurance, a fund for personal consumption of the capitalist, a fund for management of the workers, and, finally, profit. Profit can become realized surplus-value in being used to expand the process of production, or, being invested.

Having come to profit, we also come to the issue of price and money. In critiquing Marxism, bourgeois economists and their parrots often raise the accusation that Marx thought the value of a commodity is equivalent to the cost of labor or the cost of production, when (in their minds at least) value is really determined according to marginal utility. This essentially means that it’s subjective, determined according to its usefulness to the individual buyer and seller. Its value is apparently the highest the buyer is willing to buy it and the lowest the seller is willing to sell it, determined of course according to the individuals’ subjective evaluation of the commodity. Now this is all well and good if you make no distinction between price and value. Marx never equated the two, as identified earlier. Marx in fact spends significant time in all 3 volumes of Capital distinguishing between the two, with Volumes Two and Three being almost entirely dedicated to examining the relationship between price and value. In Wage Labour and Capital, Marx says of price:

Marx very well takes account of the mechanisms behind price, and the distinction between price and value. So, what’s the relationship of price to profit? The cost of production is determined, in part, by the price of the factors of production, by upkeep of the means of production, and of labor-power. A capitalist can increase their profit in one manner by decreasing the cost of one or more of these. A capitalist’s ability to turn a profit also depends on whether the price of their finished commodity on sale can realize some or all of the surplus-value embodied in it. At times, price can be driven uncomfortably close to the cost of their production by competition, giving little chance to realize any surplus-value, or they can be purposely sold at or below their cost of production by larger companies in order to outcompete smaller companies who cannot afford such an expenditure, as John D. Rockefeller did with Standard Oil. The resale of a commodity at a price above that which it was purchased by does not disprove the Marxist understanding of price and value. Marx says of this practice in Capital Volume Three:

Essentially, the merchant purchased the commodity at a price where the total value of it was not realized, usually at a price that includes some of the surplus-value. Thus, they can sell it at a price that realizes the cost of their purchase and a greater share of the surplus-value that has not yet been realized. This doesn’t mean a commodity cannot be sold at a price above its value. Done by an individual or a smaller firm, this practice is unsustainable, and tends to be phased out by competition, as Marx explained in the Wage Labour and Capital excerpt quoted earlier. A firm can, however, sell at a price above a commodity’s value sustainably when they are a monopoly, and thus can sell at monopoly prices. As a monopoly, this firm eliminates the factor of competition which tends to drive overpricing down, and so price gouging tends to occur. This sort of monopoly pricing can also occur when demand is inflexible, or consumers lack much of a choice in opting out of consumption of the commodity at hand. For example, think of stores gouging the prices of means of subsistence like bottled water during disasters. When a firm sells at monopoly prices, they can realize a profit beyond the value embodied in a commodity. These various fluctuations in price lead to price distortions, and makes it more difficult to determine the true value of something. That does not, however, mean value and price are the same. Marx’s analysis proves to hold far greater nuance and correctness than childish marginal utility theory.

All of this discussion of value, of labor-power, of surplus-value and so on, and yet we haven’t even examined the means of production. What are they anyways? Everyone knows Marx’s famous call to “seize the means of production”, but do they know what the means of production are? In Capital Volume One, he says:

So, means of production are the tools and machines involved in production and the factors of production, the latter being the “subject of labor”. Marx does not ignore the history of the means of production, and in fact details their history from the first tools in Capital Volume One. Tools, machines, means of production, they are defined by a body’s use of them to labor beyond its natural capacity. In calling for the seizure of the means of production, Marx also recognizes that the means of production are now privately owned by capitalists. The means of production are used to produce means of subsistence, the latter being in a commodity form, having exchange-value, and owned by the capitalists by extension of their ownership of the means of production. So, for a proletarian to access the means of subsistence, they must sell their labor-power to a capitalist in exchange for a wage, which they use to purchase their means of subsistence. The proletariat engages in socialized production, cooperating among itself, in order to produce commodities for the consumption of society. And yet, the capitalists appropriate their produce. Marx describes this situation thusly, in Capital Volume One:

We will deal with the contradiction of socialized production and private appropriation and of the expropriation of expropriators later. Before we finish our discussion of the means of production, we must ask: Have they always been owned privately, by a few capitalists? No. In most of human history, before the globalization of capitalism, the producer or a firm of producers own the means of production and directly reap the product of their labor or labor-power. This is true in peasant agricultural societies, and it is also true in hunter-gatherer societies.

Through this power over the means of production and subsistence, the laborers had a degree of control over their lives. The expropriation of the means of production by the bourgeoisie, or primitive accumulation, as is famously represented by the Enclosures of the commons in England, represents both the divorce of the producer from the means of production and the accumulation of initial capital in the form of the newly seized property. It creates the initial capital and the wage-laborers to toil on it (for more on primitive accumulation and capital accumulation broadly, please read The Accumulation of Capital by Rosa Luxemburg and Caliban and the Witch by Silvia Federici). The divorce of the producer from the means of production leads us to yet another famous, yet often misunderstood, Marxist concept: that of alienation. The most well-known definition of Marxian alienation is the loss of meaning, of self-recognition, in the laborer’s toiling. The product of their labor becomes something alien to them by it being appropriated by the capitalist through the latter’s ownership of the means of production. This is not the only facet of Marxian alienation, however. Marx identifies at least 4 kinds of capitalist alienation: The aforementioned alienation from the product of labor, from the process of production, from other people (who the worker interacts with largely in relation to the labor-process rather than as personalities), and from species-essence. Now, by species-essence, Marx does not mean some sort of innate human nature. He means those characteristics which make a human a human, such as needing to engage in social interaction due to human beings, due to our particular physical and psychological characteristics, relying on social labor in order to survive. A human lacks the sharp teeth, rapid speed, and so on to acquire the means of subsistence as individuals sustainably, we tend toward cooperative labor and thus social behavior. This is what is meant by species essence.

We have just traced the facets of capitalist production. It is necessary to now examine the circuit of commodities, and the associated composition of capital. Under capitalist production, a commodity’s circuit is expressed in Marxian terms as being Money — Commodity…. Production…. Increased Value Commodity — Increased Value Money. In symbolic terms, this is expressed as M-C…P…C’-M’. The capitalist begins with a quantity of money, equivalent in exchange-value to a certain mass of a certain commodity, typically raw materials. They use the money to purchase this mass, again, usually raw materials, and puts it through the process of production. The commodity comes out the other side with a changed form and an increased value composition. We will be getting into its valorization very soon. The commodity is sold for a mass of money greater than that initially held. This M-C…P…C’-M’ circuit can be expressed focusing on each different step in the process of production, (for example P…C’-M’…M [new expression of M’]-C…P…C’-M’) and is repeated into infinity, at least in theory. It expresses the overview of capitalist production, and identifies its purpose: the realization of surplus-value. To understand the circuit, however, we must understand how the capitalist increases the value they hold, and to do that, we must examine capital and its composition.

What is capital? As the well-known quote goes, from Capital Volume One:

Capital is essentially an accumulated form of the value of socially necessary labor-time, owned by the capitalist through their appropriation of surplus-value. When we went into the dividing up of surplus-value into different funds, we identified one of these funds as that which goes into further investments. This new fund is new capital. This new capital can only be accumulated, can be realized, by this investment, and investment means the hiring of new laborers. Capital does not only go to this investment, however. It also goes to the factors of production and the maintenance of the means of production, as well as insurance and other funds, though those do not interest here. These expenditures on labor, factors of production, and means of production are the composition of capital, and are what goes into the valorization process.

What is labor-power called as a compositional part of capital? It is called variable capital. Variable capital is the only source by which a capitalist can extract surplus-value, as we outlined earlier. You cannot “pay” a machine less than its cost of purchase and maintenance. Variable capital transfers to the valorized commodity not only the value of the necessary labor-time embodied in the commodity, but also the surplus labor-time embodied in it. The capitalist’s command over new variable capital comes from from the ownership of the product of old variable capital, of dead labor.

How can the capitalist increase the mass of surplus-value reaped from variable capital? There are two general method-forms of surplus-value: absolute and relative. Marx, in Capital Volume One, explains absolute surplus as being reaped through:

In short, the capitalist merely increases the total time worked, and increases the yield of surplus value, while also increasing the cost of necessary labor-time. This latter downside leads the capitalist to relative surplus-value. On this, Marx says, in the aforementioned book:

Relative surplus-value is reaped through far more refined means than absolute, it deals more with rates than masses. Economizing on the cost of production is achieved by reducing the time dedicated to the reproduction of necessary labor-time. This is done by decreasing the rate of wages, increasing the rate at which workers labor (which can be measured by dividing their new average hourly product to their old average hourly product, thus finding the rate of increase in labor productivity) decreasing the cost of factors of production, and increasing the productivity of the means of production. The latter method points us right toward the direction of the other compositional bodies of capital.

What is the non-labor-power composition of capital called? This composition, which is more often recognized as capital, is called fixed capital. Fixed capital is divided into constant capital, the means of production, and circulating capital, the factors of production or object of labor. Constant capital’s initial value comes from the socially necessary labor-time embodied in its production, in the production of the means of production. It transfers its value to the commodities not all at once; the means of production do not merely drop all of their value onto one commodity. Rather, value is transferred from constant capital to the commodity according to the rate at which the commodity exerts wear-and-tear on the means of production. This wear-and-tear that goes into producing the commodity represents a transfer out of the constant capital into the product. When a capitalist makes expenditures on maintenance of the means of production, they are reproducing this value that has been transferred. Think of this like a stamp. You rub a stamp in ink, think of the ink as the total value of the constant capital. Each time you stamp something, some ink, or value, comes off the constant capital and transfers to the product. Eventually, the ink, or value, is depleted, and you must reproduce it by expending value, or ink, on the maintenance of the constant capital, the means of production. An increase in the productivity of constant capital decreases the rate at which it transfers value, as the wear-and-tear is decreased, and a greater mass of commodities is produced than before, thus explaining the method of relative surplus-value identified earlier.

Circulating capital represents the total value of the factors of production, of the raw materials. This value is essentially the total socially necessary labor-time embodied in them, and is transferred over to the finished product along with the value transferred by the constant and variable capital. It is important to note that value is not always carried over perfectly, just as its important to note that price does not always allow for the total or even partial realization of value. Damage to a commodity or shoddy production can lead to a lower than average transfer of value, and a devalued commodity. Marx’s model does not presume perfection of the production process.

We have given a broad overview of capitalist production. We will now briefly identify how the capitalist mode of production spells its own doom due to internal contradictions. Let us quote from Rosa Luxemburg’s Reform or Revolution? for this purpose:

The anarchy of capitalist production lies in its own mechanisms. We, however, will confine ourselves to the primary issue leading to its anarchy: the tendency of the rate of profit to fall (TRPF). The TRPF occurs as the composition of capital changes. Specifically, capitalists increase the relative composition of constant capital through technological improvements which increase productivity. Thus, the capitalists can expend less on variable capital and make the same quantity of commodities, so they hire fewer workers. As we have identified before, variable capital is the only source of surplus-value. With less variable capital, there is, true, less expenditure on necessary labor-time, but there is also less surplus-value relative to the cost of production.

Here we must get into the rate of profit and rate of surplus-value versus the mass of profit and of surplus-value. We have already explained the distinction between profit and surplus-value, which profit is merely a component of. But what is the rate of surplus-value? The rate of surplus-value is the ratio of surplus-value relative to the variable capital expended in production. The rate of profit is the ratio surplus value to the cost of production (constant, variable, and circulating capital). The rate of profit, on a social level, is equalized to a general, or average, rate of profit by competition. This competition leads to a general cost of fixed capital, and thus a general rate of profit. If the quantity of surplus-value decreases, due to a decrease in variable capital, relative to the other compositions of capital, then the rate of profit decreases. Because capitalism develops productive technology, categorized as constant capital, it increases the composition of constant capital relative to variable capital. Thus, it creates a tendency of the rate of profit to fall. It is important to identify that it is a tendential decline, not absolute. This means the rate of profit is not eternally declining, but over time tends to fall.

Let us again quote from Marx, in Capital Volume Three, on the ramifications of the TRPF:

Capital is not unaware of this tendency of the rate of profit to fall. It engages in emergency economizing measures to reconcile the issue and to temporarily stall the tendency of the rate of profit to decline. One method is by decreasing wages. The increase of the productivity of constant capital, and resulting decrease in the workforce, creates a surplus of unemployed workers, an industrial reserve army of labor. This industrial reserve army’s competition is used to decrease wages of employed laborers through competition, decreasing expenditure on variable capital and thus temporarily relatively increasing the rate of profit. The capitalist may also increase the rate of labor while keeping the same rate of wages, increasing the surplus labor-time. The capitalist can also engage in swindling methods to economize on the cost of production, like through wage theft or price gouging. They cannot, however, forestall the tendency’s reality, or its meaning: that capitalism’s characteristics inherently tend towards crises, that the spread of capitalist production and increase in the scale of production creates a greater risk of crises, and the world market combined with socialized production ensures the far spread of these crises. If you doubt the reality of the TRPF, simply have a look at the US economy.

Let us now come to the contradiction of social production and private appropriation. This is what represents a tendency toward socialism as a result of capitalist collapse. Engels explains, in Socialism: Utopian and Scientific:

These antagonistic classes brings us to the third basis of socialism within capitalism: the tendency for the mass of the proletariat, or proletarianized classes, to grow. The proletariat is necessary for capitalist production, the production process is carried out by wage laborers. Capitalism proletarianizes people from large swathes of the population, from the peasantry to the petite-bourgeoisie, the guildmasters to the slaves. That is not to say there are no other classes than the bourgeoisie and proletariat, take a glance at The 18th Brumaire of Louis Bonaparte for proof that Marx makes no such claim. He mentions the intelligentsia, the peasantry, the petite-bourgeoisie, the lumpenproletariat, the landed estates, and so on. It is to say that they are the primary classes, the classes directly engaged in production, the classes which all other classes take the side of one or another in their struggle. The proletariat has no investment in capitalism, they own no property to hold onto that would make them fear revolutionary chains. To quote the famous Communist Manifesto, they “have nothing to lose but their chains. They have a world to win.” This world is the socialized appropriation of socialized production. Those classes which also become revolutionary, such as the peasantry, become so largely because they are threatened by proletarianization or pauperization, and so find common cause with the proletariat. The tendency for the proletariat to grow represents capital’s production of the very class which will land a death-blow upon its head.

When the expropriators are expropriated, what does this represent? It represents the seizure of political power by the proletariat. What is this? Marx refers to it as lower-stage communism, though most modern Marxists simply call it socialism. Marx, of course, did not detail the specifics of communist society very much, as he was not a utopian. He only identified the basics of their modes of production and distribution, as well as giving a broad outline of their society according to the preconditions which produce them. Marx deals with lower- and higher-stage communism in scattered sections throughout his works, including in all three volumes of Capital, but we will focus on what he detailed in the Critique of the Gotha Programme, which is the most focused on the subject. On the question of the state, he says:

Essentially, the proletariat must hold absolute political power, and wield it over the bourgeoisie. This represents the primary preliminary process toward lower-stage communism, or socialism. The dictatorship is the assertion of class power, socialism is the process of abolition. The proletariat must combat the bourgeoisie, seeking the elimination of them as a class (not a group of people) in order to abolish class distinctions broadly. Socialism represents the development of productive capacity toward the state wherein production for direct immediate consumption (communism) can be established, the destruction of class distinctions (primarily characterized by war with the bourgeoisie), and the development of socialized appropriation. These characteristics are carried out by the proletariat organized as the ruling class, as a state which is “the revolutionary dictatorship of the proletariat.” Marx clarifies that, “the working class cannot simply lay hold of the ready-made state machinery, and wield it for its own purposes.” The proletarian dictatorship must be a new state, crafted to the necessities of proletarian class rule.

We will refer to Lenin for the specifics of how this state is characterized. For those who may be told that Lenin misrepresents Marx’s view of the state in The State and Revolution, we recommend referring not only to Marx’s Critique of the Gotha Programme, but also The Civil War in France, and The 18th Brumaire of Louis Bonaparte to see that there is no contradiction in Marx and Lenin’s understanding of the state, Lenin is not a liar. With that out of the way, Lenin says, in The Proletarian Revolution and the Renegade Kautsky,

The Soviet state represented an example of an organ of proletarian class rule crafted for Russia’s conditions, and its mode of production was socialist. What was Marx’s sketch of the socialist mode of production? Is there still surplus labor-time? Is surplus-produce taken by the individual? We’ll quote from The Critique of the Gotha Programme again, where he states:

Engels further elaborates on the socialization of surplus-produce in Anti-Dühring:

Many may decry that the socialist states represented or represent a degeneration, as they had commodity production, did not immediately abolish the state, and did not reach higher-stage communism. We will refer first to the aforementioned text by Marx:

Marx did not describe this society summed up by “from each according to their ability, to each according to their contribution” according to moral values of productivity. As he says in Value, Price, and Profit:

Socialism arises out of the conditions of capitalism. It not only must develop productive capacity in order to reconcile this, to eliminate commodity production over time, thus abolishing the value-form, but repress and disintegrate the bourgeoisie as a class, thus why the state remains for a long time, in fact it must remain until the bourgeoisie is eliminated. As Lenin says in The Proletarian Revolution and the Renegade Kautsky:

In the same text, he says:

So the proletarian state must remain to serve its purpose, the final struggle to destroy class distinctions is long and drawn out. The socialist states were and are not “failures”, these critics simply cannot grasp the enormity of historical epochs, modes of production, and social relations.

We have established the reality of socialist development. Let us now close this essay by dealing with communist development, which is often disparaged as utopian by anti-Marxists. Communism has a very real basis in capitalist development, which we have already identified. But what is the communist system? Communist society is well-known to be described as a stateless, classless, moneyless society. What does this mean specifically? By stateless, it means there is no longer a specialized body for the organization of repression, an organ of class rule, as class distinctions have been abolished. The abolition of class distinctions leads to the withering away of the state. Do not picture this as something immediate. It is a long, drawn out process. The state, as has been detailed, is an organ of class rule. It arises with classes, as Engels explains in On the Origin of the Family, and will fall with them:

Why does the state wither away? Because, with class distinctions, there are antagonisms of interests; what benefits one harms another. Without class distinctions, what benefits one benefits all, and so a state is not necessary to mediate between classes to ensure social cohesion, or to exert the rule of the dominant class. This does not mean the abolition of authority, which is something necessary to the organization of certain industries (see On Authority by Engels). It is the abolition of the state as something beyond the direct actions of society as a whole. In short, the members of society regulate their own intercourse, as the antagonisms caused by class distinction and a lack of socialized appropriation of developed productive capacity have been eliminated. The abolition of classes, it must be noted, does not necessarily mean absolute equality. Engels says, in a letter to August Bebel (March 18–28, 1875):

Difference in conditions means it is impossible to compare two different people in different contexts, and thus establish equality.

The “moneyless” aspect of communism merely means abolition of commodity production and the establishment of production for direct, immediate consumption. This is precluded by the development of productive capacity, and does not mean that every single need is met. It merely means that appropriation has been sufficiently organized in a socialized manner, and that productive capacity has been developed enough, in order for commodity production to be totally wiped out. As Marx says in Capital Volume Three:

In short, the summary of the communist mode of distribution is “from each according to their ability, to each according to their need”. This is precluded not by utopian desires, but by material tendencies already embodied in capitalism.

Recommended Further Reading:

Value, Price, and Profit by Karl Marx

The Reproduction of Labor-Power in the Global Economy by Silvia Federici

The Accumulation of Capital by Rosa Luxemburg

Imperialism: The Highest Stage of Capitalism by Vladimir Lenin

Neo-Colonialism: The Last Stage of Imperialism by Kwame Nkrumah

I’m influenced by Marxism-Leninism-Mao Zedong Thought and social reproduction theory. Follow Line Struggle Collective

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