Capital, vol. I, The process of accumulation of capital: The transformation of surplus-value into capital

Capitalist production on a progressively increasing scale. The inversion which converts the property laws of commodity production into laws of capitalist appropriation

Earlier we considered how surplus-value arises from capital; now we have to see how capital arises from surplus-value. The employment of surplus-value as capital, or its reconversion into capital, is called accumulation of capital.¹

Let us first consider this process from the standpoint of the individual capitalist. Suppose a master-spinner has advanced a capital of £10,000, of which four-fifths (£8,000) is laid out in cotton, machinery, etc. and one-fifth (£2,000) in wages. Let him produce 240,000 lb. of yarn every year, and let the value of this yarn be £12,000. The rate of surplus-value being 100 per cent, the surplus-value is contained in the surplus, or net product, of 40,000 lb. of yarn, which is one-sixth of the gross product, and has a value of £2,000 which will be realized by a sale. £2,000 is £2,000. Neither seeing nor smelling will tell us that this sum of money is surplus-value. When we know that a given value is surplus-value, we know how its owner came by it; but that does not alter the nature either of value or of money.

In order to transform this newly acquired sum of £2,000 into capital, the master-spinner will, all circumstances remaining as before, advance four-fifths of it (£1,600) in the purchase of cotton, etc. and one-fifth (£400) in the purchase of additional spinning workers, who will find in the market the means of subsistence whose value the master has advanced to them. The new capital of £2,000 then functions in the spinning-mill and in its turn brings in a surplus value of £400.

The capital-value was originally advanced in the form of money. The surplus-value, however, existed from the outset as the value of a definite portion of the gross product. If this gross product is sold, converted into money, the capital-value regains its original form. From this moment on, the capital-value and surplus-value are both sums of money, and their reconversion into capital takes place in precisely the same way. The one as well as the other is laid out by the capitalist in the purchase of commodities that place him in a position to start making his goods again, and indeed, on a larger scale this time. But in order to be able to buy these commodities, he must find them ready in the market.

His own yarn circulates only because he brings his annual product to market, as do all other capitalists with their commodities. But these commodities, before coming to market, were already part of the annual production fund, i.e. part of the total mass of objects of every kind into which the sum total of the individual capitals, or the total social capital, had been converted in the course of the year, and of which each capitalist had in hand only a small fraction. All the transactions in the market can accomplish is the interchange of the individual components of this annual product, their transfer from one hand to another. They cannot increase the total annual production, nor can they alter the nature of the objects produced. Hence the use that can be made of the total annual product depends entirely on its own composition, and in no way on circulation.

Annual production must in the first place furnish all those objects (use-values) from which the material components of capital, used up in the course of the year, have to be replaced. After we have deducted this, there remains the net or surplus product, which contains the surplus-value. And what does this surplus product consist of? Only of things destined to satisfy the needs and desires of the capitalist class, things which consequently enter into the consumption fund of the capitalists? If that were all, the cup of surplus-value would be drained to the very dregs, and nothing but simple reproduction would ever take place.

Accumulation requires the transformation of a portion of the surplus product into capital. But we cannot, except by a miracle, transform into capital anything but such articles as can be employed in the labour process (i.e. means of production), and such further articles as are suitable for the sustenance of the worker (i.e. means of subsistence). Consequently, a part of the annual surplus labour must have been applied to the production of additional means of production and subsistence, over and above the quantity of these things required to replace the capital advanced. In a word, surplus-value can be transformed into capital only because the surplus product, whose value it is, already comprises the material components of a new quantity of capital.²

Now, in order that these components may actually function as capital, the capitalist class requires additional labour. If the exploitation of the workers already employed does not increase, either extensively or intensively, additional labour-powers must be enlisted. The mechanism of capitalist production has already provided for this in advance, by reproducing the working class as a class dependent on wages, a class whose ordinary wages suffice, not only to maintain itself, but also to increase its numbers. All capital needs to do is to incorporate this additional labour-power, annually supplied by the working class in the shape of labour-powers of all ages, with the additional means of production comprised in the annual product, and the transformation of surplus-value into capital has been accomplished. Looked at concretely, accumulation can be resolved into the production of capital on a progressively increasing scale. The cycle of simple reproduction alters its form and, to use Sismondi’s expression, changes into a spiral.³

Let us now return to our example. It is the old story: Abraham begat Isaac, Isaac begat Jacob and so on. The original capital of £10,000 brings in a surplus-value of £2,000, which is capitalized. The new capital of £2,000 brings in a surplus-value of £400, and this too is capitalized, transformed into a second additional capital, which in its turn produces a further surplus-value of £80. And the process continues in this way.

We leave out of account here the portion of the surplus-value consumed by the capitalist. We are also not interested, for the moment, in whether the additional capital is joined on to the original capital, or separated from it so that it can valorize itself independently. Nor are we concerned whether the same capitalist employs it who originally accumulated it, or whether he hands it over to others. All we must remember is this: by the side of the newly formed capital, the original capital continues to reproduce itself and to produce surplus-value, and this is true of all accumulated capital in relation to the additional capital engendered by it.

The original capital was formed by the advance of £10,000. Where did its owner get it from? ‘From his own labour and that of his forefathers’, is the unanimous answer of the spokesmen of political economy.⁴ And, in fact, their assumption appears to be the only one consonant with the laws of commodity production.

But it is quite otherwise with regard to the additional capital of £2,000. We know perfectly well how that originated. There is not one single atom of its value that does not owe its existence to unpaid labour. The means of production with which the additional labour-power is incorporated, as well as the necessaries with which the workers are sustained, are nothing but component parts of the surplus product, parts of the tribute annually exacted from the working class by the capitalist class. Even if the latter uses a portion of that tribute to purchase the additional labour-power at its full price, so that equivalent is exchanged for equivalent, the whole thing still remains the age-old activity of the conqueror, who buys commodities from the conquered with the money he has stolen from them.

If the additional capital employs the person who produced it, this producer must not only continue to valorize the value of the original capital, but must buy back the fruits of his previous labour with more labour than they cost. If we view this as a transaction between the capitalist class and the working class, it makes no difference that additional workers are employed by means of the unpaid labour of the previously employed workers. The capitalist may even convert the additional capital into a machine that throws the producers of that capital out of work, and replaces them with a few children. In every case, the working class creates by the surplus labour of one year the capital destined to employ additional labour in the following year.⁵ And this is what is called creating capital out of capital.

The accumulation of the first additional capital of £2,000 presupposes that a value of £10,000 exists, advanced by the capitalist, and belonging to him by virtue of his ‘original labour’. The second additional capital of £400 presupposes, on the contrary, only the prior accumulation of the £2,000, of which the £400 is the capitalized surplus-value. The ownership of past unpaid labour is thenceforth the sole condition for the appropriation of living unpaid labour on a constantly increasing scale. The more the capitalist has accumulated, the more is he able to accumulate.

The surplus-value that makes up additional capital no. 1 is the result of the purchase of labour-power with part of the original capital, a purchase which conformed to the laws of commodity exchange and which, from a legal standpoint, presupposes nothing beyond the worker’s power to dispose freely of his own capacities, and the money-owner’s or commodity-owner’s power to dispose freely of the values that belong to him; equally, additional capital no. 2 is merely the result of additional capital no. 1, and is therefore a consequence of the relations described above; hence each individual transaction continues to conform to the laws of commodity exchange, with the capitalist always buying labour-power and the worker always selling it at what we shall assume is its real value. It is quite evident from this that the laws of appropriation or of private property, laws based on the production and circulation of commodities, become changed into their direct opposite through their own internal and inexorable dialectic. The exchange of equivalents, the original operation with which we started, is now turned round in such a way that there is only an apparent exchange, since, firstly, the capital which is exchanged for labour-power is itself merely a portion of the product of the labour of others which has been appropriated without an equivalent; and, secondly, this capital must not only be replaced by its producer, the worker, but replaced together with an added surplus. The relation of exchange between capitalist and worker becomes a mere semblance belonging only to the process of circulation, it becomes a mere form, which is alien to the content of the transaction itself, and merely mystifies it. The constant sale and purchase of labour-power is the form; the content is the constant appropriation by the capitalist, without equivalent, of a portion of the labour of others which has already been objectified, and his repeated exchange of this labour for a greater quantity of the living labour of others. Originally the rights of property seemed to us to be grounded in a man’s own labour. Some such assumption was at least necessary, since only commodity-owners with equal rights confronted each other, and the sole means of appropriating the commodities of others was the alienation of a man’s own commodities, commodities which, however, could only be produced by labour. Now, however, property turns out to be the right, on the part of the capitalist, to appropriate the unpaid labour of others or its product, and the impossibility, on the part of the worker, of appropriating his own product. The separation of property from labour thus becomes the necessary consequence of a law that apparently originated in their identity.⁶

Therefore,* however much the capitalist mode of appropriation may seem to fly in the face of the original laws of commodity production, it nevertheless arises, not from a violation of these laws but, on the contrary, from their application. Let us make this clear once more by briefly reviewing the consecutive phases of motion whose culminating point is capitalist accumulation.

We saw, in the first place, that the original transformation of a sum of values into capital was achieved in complete accordance with the laws of exchange. One party to the contract sells his labour-power, the other buys it. The former receives the value of his commodity, whose use-value – labour – is thereby alienated to the buyer. Means of production which already belong to the latter are then transformed by him, with the aid of labour equally belonging to him, into a new product which is likewise lawfully his.

The value of this product includes: first, the value of the means of production which have been used up. Useful labour cannot consume these means of production without transferring their value to the new product; but, to be saleable, labour-power must be capable of supplying useful labour in the branch of industry in which it is to be employed.

The value of the new product includes, further, the equivalent of the value of the labour-power together with a surplus-value. This is so because the value of the labour-power – sold for a definite length of time, say a day, a week, etc. – is less than the value created by its use during that time. But the worker has received payment for the exchange-value of his labour-power and by so doing has alienated its use-value – this being the case in every sale and purchase.

The fact that this particular commodity, labour-power, possesses the peculiar use-value of supplying labour, and therefore of creating value, cannot affect the general law of commodity production. If, therefore, the amount of value advanced in wages is not merely found again in the product, but augmented by a surplus-value, this is not because the seller has been defrauded, for he has really received the value of his commodity; it is due solely to the fact that this commodity has been used up by the buyer.

The law of exchange requires equality only between the exchange-values of the commodities given in exchange for one another. From the very outset, indeed, it presupposes a difference between their use-values and it has nothing whatever to do with their consumption, which begins only after the contract has been concluded and executed.

Thus the original transformation of money into capital takes place in the most exact accordance with the economic laws of commodity production and with the rights of property derived from them. Nevertheless, its result is:

(1) that the product belongs to the capitalist and not to the worker;

(2) that the value of this product includes, apart from the value of the capital advanced, a surplus-value which costs the worker labour but the capitalist nothing, and which none the less becomes the legitimate property of the capitalist;

(3) that the worker has retained his labour-power and can sell it anew if he finds another buyer.

Simple reproduction is only the periodic repetition of this first operation; each time, money is freshly transformed into capital. Thus the law is not broken; on the contrary, it gains the opportunity to operate continuously. ‘Several successive acts of exchange have only made the last represent the first.’⁷

And yet we have seen that simple reproduction suffices to stamp this first operation, in so far as it is conceived as an isolated process, with a totally changed character. ‘Of those who share the national income among themselves, the one side’ (the workers) ‘acquire each year a fresh right to their share by fresh labour; the others’ (the capitalists) ‘have already acquired, by their original labour, a permanent right to their share.’⁸ It is indeed a well-known fact that the sphere of labour is not the only one in which primogeniture works miracles.

Nor does it matter if simple reproduction is replaced by reproduction on an extended scale, by accumulation. In the former case the capitalist squanders the whole of the surplus-value in dissipation, in the latter he demonstrates his bourgeois virtue by consuming only a portion of it and converting the rest into money.

The surplus-value is his property; it has never belonged to anyone else. If he advances it for the purposes of production, the advances made come from his own funds, exactly as on the day when he first entered the market. The fact that on this occasion the funds are derived from the unpaid labour of his workers makes absolutely no difference. If worker B is paid out of the surplus-value which worker A produced, then, in the first place, A furnished that surplus-value without having the fair price of his commodity cut by even a farthing, and, in the second place, the transaction is no concern of B’s whatever. What B claims, and has a right to claim, is that the capitalist should pay him the value of his labour-power. ‘Both of them still benefited: the worker because he was advanced the fruits of his labour’ (should read: of the unpaid labour of other workers) ‘before the work was done ‘(should read: before his own labour had borne fruit);’ the employer, because the labour of this worker was worth more than his wages’ (should read: produced more value than the value of his wages).⁹

To be sure, the matter looks quite different if we consider capitalist production in the uninterrupted flow of its renewal, and if, in place of the individual capitalist and the individual worker, we view them in their totality, as the capitalist class and the working class confronting each other. But in so doing we should be applying standards entirely foreign to commodity production.

Only the mutually independent buyer and seller face each other in commodity production. Relations between them cease on the day when the term stipulated in the contract they concluded expires. If the transaction is repeated, it is repeated as the result of a new agreement which has nothing to do with the previous one and in which it is only an accident that brings the same seller together again with the same buyer.

If, therefore, commodity production, or one of its associated processes, is to be judged according to its own economic laws, we must consider each act of exchange by itself, apart from any connection with the act of exchange preceding it and that following it. And since sales and purchases are negotiated solely between particular individuals, it is not admissible to look here for relations between whole social classes.

However long a series of periodic reproductions and preceding accumulations the capital functioning today may have passed through, it always preserves its original virginity. As long as the laws of exchange are observed in every single act of exchange – taken in isolation – the mode of appropriation can be completely revolutionized without in any way affecting the property rights which correspond to commodity production. The same rights remain in force both at the outset, when the product belongs to its producer, who, exchanging equivalent for equivalent, can enrich himself only by his own labour, and in the period of capitalism, when social wealth becomes to an ever-increasing degree the property of those who are in a position to appropriate the unpaid labour of others over and over again.

This result becomes inevitable from the moment there is a free sale, by the worker himself, of labour-power as a commodity. But it is also only from then onwards that commodity production is generalized and becomes the typical form of production; it is only from then onwards that every product is produced for sale from the outset and all wealth produced goes through the sphere of circulation. Only where wage-labour is its basis does commodity production impose itself upon society as a whole; but it is also true that only there does it unfold all its hidden potentialities. To say that the intervention of wage-labour adulterates commodity production is to say that commodity production must not develop if it is to remain unadulterated. To the extent that commodity production, in accordance with its own immanent laws, undergoes a further development into capitalist production, the property laws of commodity production must undergo a dialectical inversion so that they become laws of capitalist appropriation.¹⁰

We have seen that even in the case of simple reproduction, all capital, whatever its original source, is transformed into accumulated capital, or capitalized surplus-value. But in the flood of production the total capital originally advanced becomes a vanishing quantity (magnitudo evanescens in the mathematical sense), in comparison with the directly accumulated capital, i.e. the surplus-value or surplus product that is reconverted into capital. This occurs whether the capital originally advanced is functioning in the hands of the man who accumulated it, or in the hands of other people. Hence the political economists describe capital in general as ‘accumulated wealth’ (transformed surplus-value or revenue) ‘that is employed over again in the production of surplus-value’,¹¹ and the capitalist himself as ‘the owner of surplus-value’.¹² This same way of looking at things is merely expressed in another form in the statement that all existing capital is accumulated or capitalized interest, for interest is nothing but a fragment of surplus-value.¹³

The political economists’ erroneous conception of reproduction on an increasing scale

Before we attempt to give a more detailed characterization of accumulation or the reconversion of surplus-value into capital, we must clear out of the way an ambiguity concocted by the classical economists.

The commodities the capitalist buys with a part of the surplus-value for his own consumption do not serve as means of production or means of valorization; similarly, the labour he buys for the satisfaction of his natural and social requirements does not serve as productive labour. Instead of transforming surplus-value into capital, he rather consumes or expends it as revenue when he purchases those commodities and that labour. It was of decisive importance for the bourgeois economists, when confronted with the habitual mode of life of the old nobility, which, as Hegel rightly says, ‘consists in consuming what is available’,* and is displayed in particular in the luxury of personal retainers, to promulgate the doctrine that the accumulation of capital is the first duty of every citizen, and to preach unceasingly that accumulation is impossible if a man eats up all his revenue, instead of spending a good part of it on the acquisition of additional productive workers, who bring in more than they cost. On the other hand, the economists also had to contend against the popular prejudice which confuses capitalist production with hoarding,¹⁴ and therefore imagines that accumulated wealth is either wealth that is rescued from destruction in its existing natural form, i.e. withdrawn from consumption, or wealth that does not enter into circulation. The exclusion of money from circulation would constitute precisely the opposite of its valorization as capital, and the accumulation of commodities in the sense of hoarding them would be sheer foolishness.¹⁵ In fact the accumulation of commodities in great masses is the result either of a bottleneck in circulation or of overproduction.¹⁶ It is true that the popular mind is impressed, on the one hand, by the sight of the mass of goods that are stored up for gradual consumption by the rich,¹⁷ and on the other hand by the formation of a reserve. The latter is a phenomenon which is common to all modes of production, and we shall dwell on it for a moment when we come to analyse the process of circulation.^*

The classical economists are therefore quite right to maintain that the consumption of the surplus product by productive, instead of unproductive, workers is a characteristic feature of the process of accumulation. But at this point the mistakes also begin. Adam Smith has made it the fashion to present accumulation as nothing more than the consumption of the surplus product by productive workers. This amounts to saying that the capitalization of surplus-value consists merely in turning surplus-value into labour-power. Let us listen to Ricardo on this point: ‘It must be understood that all the productions of a country are consumed; but it makes the greatest difference imaginable whether they are consumed by those who reproduce, or by those who do not reproduce another value. When we say that revenue is saved, and added to capital, what we mean is, that the portion of revenue, so said to be added to capital, is consumed by productive instead of unproductive labourers. There can be no greater error than in supposing that capital is increased by non-consumption.’¹⁸ There can be no greater error than the one repeated after Adam Smith by Ricardo and all subsequent political economists, namely the view that ‘the portion of revenue so said to be added to capital, is consumed by productive labourers’. According to this, all surplus-value that is transformed into capital becomes variable capital. However, in actual fact the surplus-value, like the value originally advanced, divides up into constant and variable capital, into means of production and labour-power. Labour-power is the form in which variable capital exists during the process of production. In this process the labour-power is itself consumed by the capitalist while the means of production are consumed by the labour-power in the exercise of its function, i.e. labour. At the same time, the money paid for the purchase of the labour-power is converted into means of subsistence, which are consumed, not by ‘productive labour’, but by the ‘productive worker’. Adam Smith, at the end of a quite preposterous analysis, comes to the absurd conclusion that even though each individual capital is divided into a constant and a variable part, the capital of society can be entirely resolved into variable capital, i.e. it is laid out exclusively in the payment of wages.* For instance, suppose a cloth manufacturer converts £2,000 into capital. He lays out one part of the money in buying weavers, the other in woollen yarn, machinery, etc. But the people from whom he buys the yarn and the machinery themselves use a part of the purchase money to pay for labour, and so on until the whole £2,000 is spent in the payment of wages, i.e. until the entire product represented by the £2,000 has been consumed by productive workers. It is evident that the entire thrust of this argument lies in the words ‘and so on’, which send us from pillar to post. In fact, Adam Smith breaks off the investigation just where the difficulties begin.¹⁹

The annual process of reproduction is easily understood, as long as we look solely at the sum total of the year’s production. But every single component of this annual product must be brought into the market as a commodity, and there the difficulties begin. The movements of the individual capitals and personal revenues cross and intermingle, and become lost in a general alternation of positions, i.e. in the circulation of society’s wealth. This confuses the onlooker, and provides the investigation with very complicated problems to solve. In the third part of Volume 2 I shall give an analysis of the way the whole system is actually linked together. It is one of the great merits of the Physiocrats that in their Tableau économique† they were the first to attempt to depict the year’s production in the shape in which it emerges from circulation.²⁰

For the rest, it goes without saying that political economy has not failed to exploit, in the interests of the capitalist class, Adam Smith’s doctrine that the whole of that part of the net product which is transformed into capital is consumed by the working class.

Division of surplus-value into capital and revenue. The abstinence theory

In the previous chapter, we treated surplus-value (or the surplus product) solely as a fund for satisfying the capitalist’s individual consumption requirements. In this chapter, so far, we have treated it solely as a fund for accumulation. In fact, however, it is neither the one nor the other: it is both. One part of the surplus-value is consumed by the capitalist as revenue,²¹ the other part is employed as capital, i.e. it is accumulated.

With a given mass of surplus-value, then, the larger the one part, the smaller the other. Other things being equal, the ratio of these parts determines the magnitude of the accumulation. But it is the owner of the surplus-value, the capitalist, who makes this division. It is an act of his will. That part of the tribute exacted by him which he accumulates is said to be saved by him, because he does not consume it, i.e. because he performs his function as a capitalist, and enriches himself.

Except as capital personified, the capitalist has no historical value, and no right to that historical existence which, to use Lichnowsky’s amusing expression, ‘ain’t got no date’.* It is only to this extent that the necessity of the capitalist’s own transitory existence is implied in the transitory necessity of the capitalist mode of production. But, in so far as he is capital personified, his motivating force is not the acquisition and enjoyment of use-values, but the acquisition and augmentation of exchange-values. He is fanatically intent on the valorization of value; consequently he ruthlessly forces the human race to produce for production’s sake. In this way he spurs on the development of society’s productive forces, and the creation of those material conditions of production which alone can form the real basis of a higher form of society, a society in which the full and free development of every individual forms the ruling principle. Only as a personification of capital is the capitalist respectable. As such, he shares with the miser an absolute drive towards self-enrichment. But what appears in the miser as the mania of an individual is in the capitalist the effect of a social mechanism in which he is merely a cog. Moreover, the development of capitalist production makes it necessary constantly to increase the amount of capital laid out in a given industrial undertaking, and competition subordinates every individual capitalist to the immanent laws of capitalist production, as external and coercive laws. It compels him to keep extending his capital, so as to preserve it, and he can only extend it by means of progressive accumulation.

In so far, therefore, as his actions are a mere function of capital – endowed as capital is, in his person, with consciousness and a will – his own private consumption counts as a robbery committed against the accumulation of his capital, just as, in double-entry book-keeping, the private expenditure of the capitalist is placed on the debit side of his account against his capital. Accumulation is the conquest of the world of social wealth. It is the extension of the area of exploited human material and, at the same time, the extension of the direct and indirect sway of the capitalist.²²

But original sin is at work everywhere. With the development of the capitalist mode of production, with the growth of accumulation and wealth, the capitalist ceases to be merely the incarnation of capital. He begins to feel a human warmth towards his own Adam, and his education gradually enables him to smile at his former enthusiasm for asceticism, as an old-fashioned miser’s prejudice. While the capitalist of the classical type brands individual consumption as a sin against his function, as ‘abstinence’ from accumulating, the modernized capitalist is capable of viewing accumulation as ‘renunciation’ of pleasure. ‘Two souls, alas, do dwell within his breast; The one is ever parting from the other.’*

At the historical dawn of the capitalist mode of production – and every capitalist upstart has to go through this historical stage individually – avarice, and the drive for self-enrichment, are the passions which are entirely predominant. But the progress of capitalist production not only creates a world of delights; it lays open, in the form of speculation and the credit system, a thousand sources of sudden enrichment. When a certain stage of development has been reached, a conventional degree of prodigality, which is also an exhibition of wealth, and consequently a source of credit, becomes a business necessity to the ‘unfortunate’ capitalist. Luxury enters into capital’s expenses of representation. Moreover, the capitalist gets rich, not, like the miser, in proportion to his personal labour and restricted consumption, but at the same rate as he squeezes out labour-power from others, and compels the worker to renounce all the enjoyments of life. Thus although the expenditure of the capitalist never possesses the bona fide character of the dashing feudal lord’s prodigality, but, on the contrary, is always restrained by the sordid avarice and anxious calculation lurking in the background, this expenditure nevertheless grows with his accumulation, without the one necessarily restricting the other. At the same time, however, there develops in the breast of the capitalist a Faustian conflict between the passion for accumulation and the desire for enjoyment.

Dr Aikin says, in a work published in 1795: ‘The trade of Manchester may be divided into four periods. First, when manufacturers were obliged to work hard for their livelihood.’ They enriched themselves chiefly by robbing the parents whose children were bound as apprentices to them: the parents paid a high premium, while the apprentices were starved. On the other hand, the average profits were low, and, in order to accumulate, extreme parsimony was needed. They lived like misers, and were far from consuming even the interest on their capital. ‘The second period, when they had begun to acquire little fortunes, but worked as hard as before’ (for the direct exploitation of labour costs labour, as every slave-driver knows) ‘and lived in as plain a manner as before… The third, when luxury began, and the trade was pushed by sending out riders for orders into every market town in the Kingdom… It is probable that few or no capitals of £3,000 to £4,000 acquired by trade existed here before 1690. However, about that time, or a little later, the traders had got money beforehand, and began to build modern brick houses, instead of those of wood and plaster.’ Even in the early part of the eighteenth century, a Manchester manufacturer who placed a pint of foreign wine before his guests exposed himself to the remarks and headshakings of all his neighbours. Before the rise of machinery, a manufacturer’s evening expenditure at the public house where they all met never exceeded sixpence for a glass of punch, and a penny for a screw of tobacco. It was not till 1758, and this marks an epoch, that a person actually engaged in business was seen with a carriage of his own. ‘The fourth period,’ the last thirty years of the eighteenth century, ‘is that in which expense and luxury have made great progress, supported by a trade extended by means of riders and factors through every part of Europe.’²³ What would the good Dr Aikin say if he could rise from the grave and see the Manchester of today?

Accumulate, accumulate! That is Moses and the prophets! ‘Industry furnishes the material which saving accumulates.’²⁴ Therefore save, save, i.e. reconvert the greatest possible portion of surplus-value or surplus product into capital! Accumulation for the sake of accumulation, production for the sake of production: this was the formula in which classical economics expressed the historical mission of the bourgeoisie in the period of its domination. Not for one instant did it deceive itself over the nature of wealth’s birth-pangs.²⁵But what use is it to lament a historical necessity? If, in the eyes of classical economics, the proletarian is merely a machine for the production of surplus-value, the capitalist too is merely a machine for the transformation of this surplus-value into surplus capital. Classical economics takes the historical function of the capitalist in grim earnest. In order to conjure away the awful conflict between the desire for enjoyment and the drive for self-enrichment, Malthus, around the beginning of the 1820s, advocated a division of labour which assigned the business of accumulating to the capitalist actually engaged in production, and the business of spending to the other sharers in surplus-value, the landed aristocracy, the place-men, the beneficed clergy and so on. It is of the highest importance, he says, ‘to keep separate the passion for expenditure and the passion for accumulation’.²⁶ The capitalists, who had long since turned themselves into good livers and men of the world, complained loudly at this. What, exclaimed one of their spokesmen, a follower of Ricardo, does Mr Malthus preach high rents, heavy taxation, etc. so that the industrious may constantly be kept up to the mark by the pressure of unproductive consumers? By all means let there be production, production on a constantly increasing scale, runs the shibboleth, but ‘production will, by such a process, be far more curbed in than spurred on. Nor is it quite fair thus to maintain in idleness a number of persons, only to pinch others, who are likely, from their characters, if you can force them to work, to work with success.’²⁷Though he finds it unfair to spur on the industrial capitalist by depriving his bread of its butter, he still thinks it necessary to reduce the worker’s wages to a minimum, ‘to keep him industrious’. Nor does he for a moment conceal the fact that the appropriation of unpaid labour is the secret of making a profit. ‘Increased demand on the part of the labourers means nothing more than their disposition to take less of their own product for themselves, and leave a greater part of it to their employers; and if it be said, that this begets glut, by lessening consumption’ (on the part of the workers) ‘I can only reply that glut is synonymous with large profits.’²⁸

The learned dispute between the industrial capitalist and the wealthy landowning idler as to how the booty pumped out of the workers may most advantageously be divided for the purposes of accumulation had to fall silent in the face of the July Revolution. Shortly afterwards, the urban proletariat sounded the tocsin of revolution at Lyons, and the rural proletariat began to set fire to farmyards and hayricks in England. On this side of the Channel Owenism began to spread; on the other side, Saint-Simonism and Fourierism. The hour of vulgar economics had arrived. Exactly a year before Nassau W. Senior discovered at Manchester that the profit (including interest) of capital is the product of the unpaid ‘last hour of the twelve hours of labour’,* he had announced to the world another discovery. ‘I substitute,’ he proudly says, ‘for the word capital, considered as an instrument of production, the word abstinence.’²⁹ An unparalleled example of the ‘discoveries’ of vulgar economics! It replaces an economic category with a sycophantic phrase, and that is all. ‘When the savage,’ says Senior, ‘makes bows, he exercises an industry, but he does not practise abstinence.’ This is supposed to explain how and why, in the earlier states of society, the implements of labour were constructed ‘without the abstinence’ of the capitalist. ‘The more society progresses, the more abstinence is demanded,’³⁰ namely from those whose business it is to appropriate the industry and the products of others. All the conditions necessary for the labour process are now converted into acts of abstinence on the part of the capitalist If the corn is not all eaten, but in part also sown – abstinence of the capitalist. If the wine gets time to mature – abstinence of the capitalist.³¹ The capitalist robs himself whenever he ‘lends (!) the instruments of production to the worker’, in other words, whenever he valorizes their value as capital by incorporating labour-power into them instead of eating them up, steam-engines, cotton, railways, manure, horses and all; or, as the vulgar economist childishly conceives, instead of dissipating ‘their value’ in luxuries and other articles of consumption.³² How the capitalist class can perform the latter feat is a secret which vulgar economics has so far obstinately refused to divulge. Enough that the world continues to live solely through the self-chastisement of this modern penitent of Vishnu, the capitalist. Not only accumulation, but the simple ‘conservation of a capital requires a constant effort to resist the temptation of consuming it’.³³ The simple dictates of humanity therefore plainly enjoin the release of the capitalist from his martyrdom and his temptation, in the same way as the slave-owners of Georgia, U.S.A., have recently been delivered by the abolition of slavery from the painful dilemma over whether they should squander the surplus product extracted by means of the whip from their Negro slaves entirely in champagne, or whether they should reconvert a part of it into more Negroes and more land.

In economic formations of society of the most diverse kinds, there occurs not only simple reproduction but also, though in varying degrees, reproduction on an increasing scale. Progressively more is produced and consumed, and therefore more products have to be converted into means of production. However, this process does not appear as an accumulation of capital, and consequently it does not appear as the function of a capitalist, as long as the worker’s means of production, and with them his product and means of subsistence, do not confront him in the shape of capital.³⁴ Richard Jones, who died a few years ago, and was the successor of Malthus in the chair of Political Economy at Haileybury, the college that trains people for the Indian Civil Service, discusses this point well in the light of two important facts. Since the greater part of the Indian population are peasants cultivating their land themselves, their products, their instruments of labour and their means of subsistence never take ‘the shape of a fund saved from revenue, which fund has, therefore, gone through a previous process of accumulation’.³⁵ On the other hand, in those provinces where English rule has least disturbed the old system, the non-agricultural workers are directly employed by the magnates, to whom a portion of the agricultural surplus product is rendered in the shape of tribute or rent. One part of this product is consumed by the magnates in its natural form, another part is converted by the workers into articles of luxury and other consumption goods for the use of the magnates, and the remainder forms the wage of the workers, who own their implements of labour. Here, production and reproduction on an increasing scale go on their way without any intervention from that peculiar saint, that knight of the woeful countenance, the ‘abstaining’ capitalist.

The circumstances which, independently of the proportional division of surplus-value into capital and revenue, determine the extent of accumulation, namely, the degree of exploitation of labour-power, the productivity of labour, the growing difference in amount between capital employed and capital consumed, and the magnitude of the capital advanced

If we assume the proportion in which surplus-value breaks up into capital and revenue as a given factor, the magnitude of the capital accumulated clearly depends on the absolute magnitude of the surplus-value. Suppose that 80 per cent of the surplus-value is capitalized, and 20 per cent is eaten up, then the accumulated capital will be £2,400 or £1,200, according to whether the total amount of surplus-value was £3,000 or £1,500. Hence all the circumstances that determine the mass of surplus-value operate to determine the magnitude of the accumulation. Here we shall summarize them once again, but only in so far as they offer fresh material which relates to accumulation.

It will be remembered that the rate of surplus-value depends, in the first place, on the degree of exploitation of labour-power. Political economy lays such great stress on this point that it occasionally identifies the acceleration of accumulation which results from an increase in the productivity of labour with the acceleration which arises from an increase in the exploitation of the worker.³⁶ In the chapters on the production of surplus-value we constantly assumed that wages were at least equal to the value of labour-power. But the forcible reduction of the wage of labour beneath its value plays too important a role in the practical movement of affairs for us not to stay with this phenomenon for a moment. In fact, it transforms the worker’s necessary fund for consumption, within certain limits, into a fund for the accumulation of capital.

‘Wages,’ says John Stuart Mill, ‘have no productive power; they are the price of a productive power. Wages do not contribute, along with labour, to the production of commodities, no more than the price of tools contributes along with the tools themselves. If labour could be had without purchase, wages might be dispensed with.’³⁷ But if the workers could live on air, it would not be possible to buy them at any price. This zero cost of labour is therefore a limit in a mathematical sense, always beyond reach, although we can always approximate more and more nearly to it. The constant tendency of capital is to force the cost of labour back towards this absolute zero. An eighteenth-century writer we have often quoted already, the author of the ‘Essay on Trade and Commerce’, actually reveals the innermost secret of English capital when he declares that England’s historical mission is to force down English wages to the French and Dutch level.³⁸ He says, naïvely: ‘But if our poor’ (a technical term for the workers) ‘will live luxuriously… then labour must, of course, be dear… One has only to consider what luxuries the manufacturing populace consume, such as brandy, gin, tea, sugar, foreign fruit, strong beer, printed linens, snuff, tobacco, etc.’³⁹ He quotes the work of a Northamptonshire manufacturer, who, with one eye on heaven, laments: ‘Labour is one-third cheaper in France than in England; for their poor work hard, and fare hard, as to their food and clothing. Their chief diet is bread, fruit, herbs, roots, and dried fish; for they very seldom eat flesh; and when wheat is dear, they eat very little bread.’⁴⁰ ‘To which may be added,’ our essayist continues, ‘that their drink is either water or other small liquors, so that they spend very little money… These things are very difficult to be brought about; but they are not impracticable, since they have been effected both in France and in Holland.’⁴¹ Twenty years later, an American humbug, the ennobled Yankee Benjamin Thompson (alias Count Rumford),* pursued the same line in philanthropy, to the great satisfaction of God and man. His Essays are a cookery book with recipes of all kinds for replacing the ordinary, but expensive food of the worker with various surrogates. The following is a particularly successful recipe issued by this remarkable ‘philosopher’: ‘5 lb. of barley-meal, 7 1/2d.; 5 lb. of Indian corn, 6 1/4d.; 3d. worth of red herring, 1d. salt, 1d. vinegar, 2d. pepper and sweet herbs, in all 20 3/4d.; make a soup for 64 men, and at the medium price of barley and of Indian corn… this soup may be provided at 1/4d. the portion of 20 ounces.’⁴² With the advance of capitalist production, the adulteration of food has rendered Thompson’s ideal superfluous.⁴³

At the end of the eighteenth and during the first ten years of the nineteenth century, the English farmers and landlords enforced the absolute minimum of wages by paying the agricultural labourers less than the minimum in the actual form of wages, and the remainder in the form of parochial relief. Here is an example of the buffoonery of the English Dogberries, when they were ‘legally’ laying down a wage-tariff: ‘The squires of Norfolk had dined, says Mr Burke, when they fixed the rate of wages; the squires of Berks evidently thought the labourers ought not to do so, when they fixed the rate of wages at Speenhamland, 1795… There they decided that, “income (weekly) should be 3s., for a man”, when the gallon or half-peck loaf of 8 lb. 11 oz. is at 1s., and increase regularly till bread is 1s. 5d.; when it is above that sum, decrease regularly till it be at 2s., and then his food should be 1/5th less.’⁴⁴ Before the Committee of Inquiry of the House of Lords (1814) a certain A. Bennett, a big farmer, magistrate, poor-law guardian and wage-regulator, was asked: ‘Has any proportion of the value of daily labour been made up to the labourers out of the poors’ rate?’ Answer: ‘Yes, it has; the weekly income of every family is made up to the gallon loaf (8 lb. 11 oz.), and 3d. per head!… The gallon loaf per week is what we suppose sufficient for the maintenance of every person in the family for the week; and the 3d. is for clothes, and if the parish think proper to find clothes, the 3d. is deducted. This practice goes through all the western part of Wiltshire, and, I believe, throughout the country.’⁴⁵

‘For years’, exclaims a bourgeois writer of the time, ‘they (the farmers) have degraded a respectable class of their countrymen, by forcing them to have recourse to the workhouse… the farmer, while increasing his own gains, has prevented any accumulation on the part of his labouring dependants.’⁴⁶ The case of so-called ‘domestic industry’ shows the part played in our own time by direct robbery from the worker’s necessary consumption-fund in the formation of surplus-value, and therefore in the formation of the fund for the accumulation of capital.* We shall give further facts on this subject later.

Although that portion of the constant capital which consists of the instruments of labour must, in all branches of industry, be sufficient for a certain number of workers (this number being determined by the size of the enterprise), it by no means always necessarily increases in the same proportion as the quantity of labour employed. Let us suppose that 100 workers, working 8 hours a day in a given factory, yield 800 hours of labour. If the capitalist wishes to raise this total by one half, he can employ 50 more workers; but then he must also advance more capital, not merely for wages, but for instruments of labour. But he might also let the 100 workers work 12 hours instead of 8, and then the instruments of labour already to hand would suffice. They would merely be consumed more rapidly. Thus additional labour, arising from a greater exertion of labour-power, can augment the surplus product and surplus-value, which is the substance of accumulation, without a proportional augmentation in the constant part of capital.

In the extractive industries, mines etc., the raw materials do not form part of the capital advanced. The object of labour is in this case not a product of previous labour, but something provided by nature free of charge, as in the case of metals, minerals, coal, stone, etc. Here the constant capital consists almost exclusively of instruments of labour which can very easily absorb an increased quantity of labour (day and night shifts, for example). All other things being equal, the mass and value of the product will rise in direct proportion to the labour expended. As on the first day of production, the two original agencies working to form the product, man and nature, continue to co-operate, and now, as creators of the products, they are also creators of the material elements of capital. Thanks to the elasticity of labour-power, the domain of accumulation has extended without any prior increase in the size of the constant capital.

In agriculture, the amount of land under cultivation cannot be increased without laying out more seed and manure. But once this has been done, the purely mechanical ploughing of the soil itself produces a marvellous effect on the size of the product. A greater quantity of labour, performed by the same number of workers as before, thus increases the fertility of the land without requiring any new contribution in the form of instruments of labour. It is once again the direct action of man on nature which becomes an immediate source of greater accumulation, without the intervention of any new capital.

Finally, in industry proper, every additional expenditure of labour presupposes a corresponding additional expenditure of raw materials, but not necessarily of instruments of labour. And as extractive industry and agriculture supply manufacturing industry both with its own raw materials and with those for its instruments of labour, the additional product provided by extractive industry and agriculture without any additional advance of capital also redounds to the advantage of manufacturing industry.

We arrive, therefore, at this general result: by incorporating with itself the two primary creators of wealth, labour-power and land, capital acquires a power of expansion that permits it to augment the elements of its accumulation beyond the limits apparently fixed by its own magnitude, or by the value and the mass of the means of production which have already been produced, and in which it has its being.

Another important factor in the accumulation of capital is the degree of productivity of social labour.

The mass of the products in which a certain value, and therefore a surplus-value of a given magnitude is embodied, increases along with the productivity of labour. If the rate of surplus-value remains the same (or even if it falls, provided that it falls more slowly than the productivity of labour rises), the mass of the surplus pro-due. increases. If the division of this product into revenue and additional capital remains the same, the consumption of the capitalist may accordingly increase without any decrease in the fund for accumulation. The relative magnitude of the accumulation-fund may even increase at the expense of the consumption-fund, while the cheapening of commodities places at the disposal of the capitalist as many means of enjoyment as formerly, or even more. But the increasing productivity of labour is accompanied by a cheapening of the worker, as we have seen, and it is therefore accompanied by a higher rate of surplus-value, even when real wages are rising. The latter never rise in proportion to the productivity of labour. The same value in variable capital therefore sets in motion more labour-power and, consequently, more labour. The same value in constant capital is embodied in more means of production, i.e. in more instruments of labour, materials of labour and auxiliary materials. It therefore supplies both more product-creating agencies and more value-creating agencies, in other words absorbers of labour. Therefore, even if the value of the additional capital remains the same or diminishes, accelerated accumulation still takes place. Not only does the scale of reproduction materially extend, but the production of surplus-value increases more rapidly than the value of the additional capital.

The growth of the productivity of labour also has an impact on the original capital, i.e. the capital which is already engaged in the production process. A part of the functioning constant capital consists of instruments of labour such as machinery, etc., which are not consumed, and therefore not reproduced or replaced, until long periods of time have elapsed. However, every year some of these instruments of labour perish, or reach the ultimate limit of their productive function. At this point, then, they reach the time for their periodic reproduction, for their replacement with other, similar machines. If the productivity of labour has increased in the place where these instruments of labour are constructed (and it does develop continually, owing to the uninterrupted advance of science and technology), the old machines, tools, apparatus, etc. will be replaced by more efficient and (considering their increased efficiency) cheaper ones. The old capital is replaced in a more productive form, not to mention continual improvements in the details of the instruments of labour actually in operation. The other part of the constant capital, raw material and auxiliary substances, is reproduced over and over again within the space of a year; the part of constant capital produced by agriculture is reproduced annually, by and large. Every time improved methods are introduced, therefore, this has an almost simultaneous impact on the new capital and the capital already engaged in its function. Every advance in chemistry not only multiplies the number of useful materials, and the useful applications of those already known, thus extending capital’s sphere of investment along with its growth; it also teaches capital how to throw back the waste from the processes of production and consumption into the cycle of the process of reproduction, and thus, without any previous outlay of capital, it creates fresh materials for it. Like the increased exploitation of natural wealth resulting from the simple act of increasing the pressure under which labour-power has to operate, science and technology give capital a power of expansion which is independent of the given magnitude of the capital actually functioning. They react at the same time on that part of the original capital which has entered the stage of its renewal. This, in passing into its new shape, incorporates, free of charge, the social advances made while its old shape was being used up. Of course, this development of productivity is accompanied by a partial depreciation of the functioning capital; but in so far as this depreciation makes itself acutely felt in competition, the main burden falls on the worker, in whose increased exploitation the capitalist seeks compensation for his loss.

Labour transmits to the product the value of the means of production consumed by it. On the other hand, the value and mass of the means of production set in motion by a given quantity of labour increase as the labour becomes more productive. Although the same quantity of labour adds to its products only the same sum of new value, the old capital-value, transmitted by the labour to the products, nevertheless continues to increase in line with the growth in productivity.

An English spinner and a Chinese spinner, for example, may work the same number of hours with the same intensity; they will then both create equal values in the course of a week. But in spite of this equality, an immense difference exists between the value of the weekly product of the Englishman, who works with a mighty automatic machine, and that of the Chinese, who only has a spinning-wheel. In the same time as the Chinese spins one pound of cotton, the Englishman spins several hundreds of pounds. A sum of old values, many hundred times as great, swells the value of his product, for in that product the old values re-appear in a new useful form, and can thus function anew as capital. ‘In 1782,’ as Friedrich Engels informs us, ‘the whole wool crop of the preceding three years’ (in England) ‘lay unused for want of workers, and would have continued so to lie if the newly invented machinery had not come to its assistance and spun it.’⁴⁷ The labour which was objectified in the form of machinery did not of course directly cause men to spring out of the earth, but it made it possible for a smaller number of workers, adding relatively less living labour, not only to consume the wool productively, and put into it new value, but also to preserve its old value, in the form of yarn, etc. At the same time, it provided the means and the incentive for an increased reproduction of wool. It is the natural property of living labour to keep old value in existence while it creates new. Hence, with the increase in efficacy, extent and value of its means of production and therefore with the accumulation which accompanies the development of its productivity, labour maintains and perpetuates an always increasing capital-value in an ever-renewed form.⁴⁸ This natural power of labour appears as a power incorporated into capital for the latter’s own self-preservation, just as the productive forces of social labour appear as inherent characteristics of capital, and just as the constant appropriation of surplus labour by the capitalists appears as the constant self-valorization of capital. All the powers of labour project themselves as powers of capital, just as all the value-forms of the commodity do as forms of money. With the growth of capital, the difference between the capital employed and the capital consumed increases. In other words, there is an increase in the value and the material mass of the instruments of labour, such as buildings, machinery, drain-pipes, ploughing oxen, apparatus of every kind that functions for a longer or shorter time in constantly repeated processes of production, or serves for the attainment of particular useful effects, while the instruments of labour themselves only gradually wear out, therefore only lose their value piecemeal, and transfer that value to the product only bit by bit. In the same proportion as these instruments of labour serve as agencies in the formation of products without adding value to those products, i.e. in the same proportion as they are wholly employed but only partly consumed, to that degree do they perform, as we saw earlier, the same free service as the forces of nature, such as water, steam, air and electricity. This free service of past labour, when it is seized on and filled with vitality by living labour, accumulates progressively as accumulation takes place on a larger and larger scale.

Since past labour always disguises itself as capital, i.e. since the debts owed to the labour of A, B, C etc. are disguised as the assets of the non-worker X, bourgeois citizens and political economists are full of praise for the services performed by past labour, which, according to that Scottish genius MacCulloch, ought indeed to receive a special remuneration in the shape of interest, profit, etc.⁴⁹ The ever-growing weight of the assistance given by past labour to the living labour process in the form of means of production is therefore attributed to that form of past labour in which it is alienated [entfremdet], as unpaid labour, from the worker himself, i.e. it is attributed to its form as capital. The practical agents of capitalist production and their ideological word-spinners are as incapable of thinking of the means of production separately from the antagonistic social mask they wear at present as a slave-owner is of thinking of the worker himself as distinct from his character as a slave.

With a given degree of exploitation of labour-power, the mass of surplus-value produced is determined by the number of workers simultaneously exploited; this corresponds, although in varying proportions, with the magnitude of the capital. Thus the more that capital increases by means of successive accumulations, the more does the sum of value increase that is divided into a fund for consumption and a fund for accumulation. The capitalist can therefore live a more pleasant life, and at the same time ‘renounce’ more. And, finally, the more the scale of production extends, along with the mass of the capital advanced, the greater the expansive capacity of its driving forces.

The so-called labour fund

It has been shown in the course of this inquiry that capital is not a fixed magnitude, but a part of social wealth which is elastic, and constantly fluctuates with the division of surplus-value into revenue and additional capital. It has been seen further that, even with a given magnitude of functioning capital, the labour-power, science and land (which means, economically speaking, all the objects of labour furnished by nature without human intervention) incorporated in it form elastic powers of capital, allowing it, within certain limits, a field of action independent of its own magnitude. In this inquiry we have ignored all relations arising from the process of circulation, which may produce very different degrees of efficiency in the same mass of capital. And since we presupposed the limits set by capitalist production, i.e. we presupposed the social process of production in a form developed by purely spontaneous growth, we disregarded any more rational combination which could be effected directly and in a planned way with the means of production and the labour-power at present available. Classical political economy has always liked to conceive social capital as a fixed magnitude of a fixed degree of efficiency. But this prejudice was first established as a dogma by the arch-philistine, Jeremy Bentham, that soberly pedantic and heavy-footed oracle of the ‘common sense’ of the nineteenth-century bourgeoisie.⁵⁰ Bentham is among philosophers what Martin Tupper* is among poets. Both could only have been manufactured in England.⁵¹ This dogma in fact renders the commonest phenomena of the production process, for instance its sudden expansions and contractions, and even accumulation itself, absolutely incomprehensible.⁵² It was used by Bentham himself, as well as by Malthus, James Mill, MacCulloch, etc., for apologetic purposes, and in particular so as to represent one part of capital, namely variable capital, or that part convertible into labour-power, as being of fixed size. Variable capital in its material existence, i.e. the mass of the means of subsistence it represents for the worker, or the so-called labour fund, was turned by this fable into a separate part of social wealth, confined by natural chains and unable to cross the boundary to the other parts. To set in motion the part of social wealth which is to function as constant capital, or, to express it in a material form, as means of production, a definite mass of living labour is required. This mass is given by technology. But the number of workers required to put this mass of labour-power in a fluid state is not given, for it changes with the degree of exploitation of the individual labour-power. Nor is the price of this labour-power given, but only its minimum limit, which is moreover very elastic. The facts on which the dogma is based are these: on the one hand, the worker has no right to interfere in the division of social wealth into means of enjoyment for the non-worker and means of production. On the other hand, it is only in favourable and exceptional cases that he can enlarge the so-called ‘labour fund’ at the expense of the ‘revenue’ of the rich.⁵³

How absurd a tautology results from the attempt to represent the capitalist limits of the labour fund as social barriers imposed by its very nature may be seen, for example, in Professor Fawcett.⁵⁴ ‘The circulating capital of a country,’ he says, ‘is its wage-fund. Hence, if we desire to calculate the average money wages received by each labourer, we have simply to divide the amount of this capital by the number of the labouring population.’⁵⁵ That is to say, we first add together the individual wages actually paid, and then we assert that the sum thus obtained forms the total value of the ‘labour fund’ handed down to us by the grace of God and Nature. Lastly, we divide the sum thus obtained by the number of workers, in order to find out how much each is permitted to receive on the average. A very shrewd way of proceeding, this is. It does not prevent Mr Fawcett from saying, in the same breath: ‘The aggregate wealth which is annually saved in England, is divided into two portions; one portion is employed as capital to maintain our industry, and the other portion is exported to foreign countries… Only a portion, and perhaps, not a large portion of the wealth which is annually saved in this country, is invested in our own industry.’⁵⁶

The greater part of the yearly accruing surplus product, which is embezzled from the English workers without any equivalent being given in return, is thus used as capital, not in England, but in foreign countries. But with the additional capital thus exported, a part of the ‘labour fund’ invented by God and Bentham naturally also flows out of the country.⁵⁷