It is true that under all circumstances, and even in a socialised society, the development of the productive forces would tend towards the production of means of production. (We have seen that in capitalist society this process assumes the form of a higher organic composition of capital.) But under normal conditions this would not mean a disproportion in the distribution of the productive forces of society. On the contrary, the course of development would be smooth and harmonious, the "demand" for raw materials growing as rapidly as their "supply." What matters here is not the relative growth of industry in general, but the disproportion in the growth of its various parts. On the other hand, this course of development must not be looked upon as the expression of an "absolute" and "natural" law, which hampers the development of agricultural products in the manner pictured by Malthus and by his numerous avowed and secret followers. The main obstacle here lies in a special social category - the monopoly of land ownership.

The mere legal property in land [says Marx in his chapter on absolute ground-rent] does not create any ground-rent for the landlord. But it gives him the power to withdraw his land from exploitation until the economic conditions permit him to utilise it in such a way that it will yield him a surplus whenever the land is used either for agriculture proper or for other productive purposes, such as buildings, etc. He cannot increase or decrease the absolute quantity of its field of employment, but he can do so with its marketable quantity. For this reason, as Fourier has already remarked, a characteristic fact in all civilised countries is that a comparatively considerable portion of the land always remains uncultivated.⁴⁾

Private property in land is then the barrier which does not permit any new investment of capital upon hitherto uncultivated or unrented land without levying a tax, in other words, without demanding a rent, although the land to be taken under new cultivation may belong to a class which does not produce any differential rent, [i.e., rent obtained in consequence of the difference in the quality of the pieces of land, etc. - N.B.] and which, were it not for the intervention of private property in land, might have been cultivated at a small increase in the market price, so that the regulating market price would have netted to the cultivator of this worst soil nothing but his price of production [i.e., production cost plus average profit - N.B.]⁵⁾

The difference between agriculture and manufacturing is this, that while the rise of prices for the products of the manufacturing industry ordinarily entails a shrinking of the demand, so that the demand curve changes rapidly in accordance with the fluctuation of prices, the demand in the sphere of distribution of agricultural products remains comparatively more stable. (One must not forget that the production of raw materials for the manufacturing industry is in a great number of cases a by-product of the production of foodstuffs, such as the production of hides, of intestines, partly of wool, etc., being connected with the meat packing industry.) This is why competition plays a substantially smaller part in agriculture, notwithstanding the fact that monopoly organisations in the strict sense of the word are very little developed there. The laws of mass production, of an accelerated accumulation of capital, etc., apply to agriculture much less than to industry.

Thus to the disproportion between the branches of production of capitalist economy in general, as emanating from the anarchical economic structure of capitalism and continuing to exist despite the processes of cartelisation, trustification, etc., there is added the specific and ever growing disproportion between industry and agriculture. It is not surprising that this latter disproportion has become most pronounced in recent times. We have noted above the intensive growth of productive forces in the last decade. The trans-oceanic countries, in the first place the United States, have developed their own industry, and consequently their own demand for an ever growing amount of agricultural products. The same took place in other agrarian countries. In Austria-Hungary, for instance, the import of breadstuffs, etc., outgrew their export in a very short time. The general rise of the productive forces of world capitalism in the last decade has so shifted and changed the interrelation between industrial and agricultural production that here, too, quantitative changes have reached a point beyond which qualitative changes begin. This is why the epoch of dearth, of a general rise in the prices of agricultural products everywhere, is a phenomenon of the most recent phase of capitalism The rise in the prices of raw materials in turn reveals itself directly in the rate of profit, for, other conditions being equal, the rate of profit rises and falls in inverse ratio to the fluctuations in the prices of raw material. Hence a growing tendency on the part of the capitalists of the individual "national economies" to widen their markets for raw materials. The same process, however, which caused the sales markets to shrink immensely, affected in like manner the markets for raw materials, since the markets for raw materials have been, and are, mainly the same countries that serve as a "foreign" market for the sale of manufactured goods, i.e., the countries of a lower development, including the colonies. The interests of the capitalists of the various great powers clash here as strongly as in the competition in the sphere of sales. There is nothing surprising in this since the process of the reproduction of social capital presupposes the importance not only of those changes that may take place in the last phase of the circulation chain, M-C...P...C'-M', i.e., in the phase of sale, but also of those that may take place in the phase M-L, i.e., in the phase of purchasing means of production. A capitalist "producer" is not only a vendor but also a buyer. He is not a vendor and a buyer pure and simple, but a capitalist vendor and a capitalist buyer; the acts of buying and selling are included here in the formula of capital circulation. They are parts of that formula. Hence it is perfectly obvious that Franz Oppenheimer's theory concerning the "peaceful character" of the buyers' competition and the hostile relations between vendors is entirely artificial.⁶⁾ He takes as a basis for his argument the thesis that the vendor ordinarily brings into the market only one commodity, and that his fate is connected with that commodity alone, i.e., with its price, whereas, says Oppenheimer, "the buyer is interested in a great variety of goods and their prices, and his interests depend comparatively little upon each one of those commodities since the price of one commodity may rise while the price of the other falls," etc. Oppenheimer fails to realise the most essential point, namely, that a present-day buyer is largely a capitalist buyer. Personal consumption is relegated to the rear compared with productive consumption on the basis of a widening reproduction. For production purposes, however, a mass purchase of a comparatively small number of commodities is required. As a rule, large masses of staple goods are being purchased, and one commodity often plays a highly important part. (Compare the importance of cotton for the textile industry.)⁷⁾

Thus there are no reasons why we should consider the struggle for raw material less acute, as Oppenheimer would wish us to do. The immense growth of competition in this field is a fact which takes on still greater significance due to the tendency of annexing territories containing deposits of coal, iron ore, copper ore, oil deposits, etc. Branches of industry that play an enormous rôle and that depend on natural conditions, are easily monopolised, and once they have fallen into the hands of certain "national" groups, they are lost for the others. Of course, this applies also to agricultural production in so far as there appears on the arena a consolidated "national" group which has at its disposal the means of "occupation." England's policy in Egypt, the transformation of all of Egypt into a gigantic cotton plantation furnishing raw material for the English textile industry, may serve as a striking illustration.

It follows that the recent phase of capitalism sharpens the conflicts also in this sphere. The faster the tempo of capitalist development, the stronger the process of industrialisation of the economic life and urbanisation of the country, the more disturbed is the equilibrium between industry and agriculture, the stronger is the competition between industrially developed countries for the possession of backward countries, the more unavoidable becomes an open conflict between them.

Here, too, capitalist expansion is a "way out" of contradictions that leads with impeccable logic to the decisive moment of imperialist policy - war.

We have so far analysed the changes that have taken place within the conditions of the world circulation of commodities and which have extraordinarily sharpened the competition between "national" capitalisms, and consequently also their aggressive policy. However, the changes that characterise our epoch are not confined to these spheres alone. The development of the productive forces of world capitalism has brought to the fore other forms of international economic relations. We have in mind the international movement of capital values, which we shall presently analyse.

Notes

¹⁾ We shall not dwell here on the methods of exploitation with which this policy has besmirched itself. We only call attention to the fact that it is not all in the "past," that, to a large degree, it is also in the present.

²⁾ On the relation between industry and agriculture as expressed in high prices, see a small but excellent pamphlet by Otto Bauer, Die Teuerung.

³⁾ List of Prices in Principal Russian and Foreign Markets for 1913, published by the Ministry of Commerce and Industry, Petrograd, 1914.

⁴⁾ Capital, Vol. III, pp. 878-879.

⁵⁾ Ibid., pp. 884-885.

⁶⁾ See his reasoning on the causes of the war in Die Neue Rundschau, August, 1915 (Franz Oppenheimer: "Die Wurzel des Krieges"). His genera: view concerning the course of social development, and his "positive solution of the problem," which, in our opinion, do not go far beyond the views of Henry George and the bourgeois "land reformists," are expounded in his "critical" work entitled, Die Soziale Frage und der Sozialismus, Jena, 1912. No one but Mr. P. Maslov is under the strong influence of this economist.

⁷⁾ Even the "producers" in concrete produce more than one commodity, not to speak of vendors in general. Department stores are a case in point. By this we do not mean to deny the importance of specialisation. We only wish to rehabilitate the "besmirched reputation" of the buyers.

Contents  |  Chapter 5  |  Chapter 7

Bukharin Archive