Das Kapital III — Kap. 14

Kap. 14

Drei Gegenursachen (I): Exploitationsgrad, Arbeitslohn, Verwohlfeilerung der Elemente des konstanten Kapitals

The reader arrives with the fall of the general rate of profit already derived, and with the tendency stated in its general form. What is settled here is the shape of the puzzle once that fall is taken as given, and how the first of the influences that slow it works, alongside the cheapening of the elements of constant capital. They are not exceptions met from outside; they arise from the same development that produces the fall. That is why the rise in the rate of surplus-value can come with a shrinking mass of labour exploited by a given capital, and why the elements of constant capital grow cheaper as their mass grows.

Wenn man die enorme Entwicklung der Produktivkräfte der gesellschaftlichen Arbeit selbst nur in den letzten 30 Jahren, verglichen mit allen frühern Perioden, betrachtet, wenn man namentlich die enorme Masse von fixem Kapital betrachtet, das außer der eigentlichen Maschinerie in die Gesamtheit des gesellschaftlichen Produktionsprozesses eingeht, so tritt an die Stelle der Schwierigkeit, welche bisher die Ökonomen beschäftigt hat, nämlich den Fall der Profitrate zu erklären, die umgekehrte, nämlich zu erklären, warum dieser Fall nicht größer oder rascher ist. Es müssen gegenwirkende Einflüsse im Spiel sein, welche die Wirkung des allgemeinen Gesetzes durchkreuzen und aufheben, und ihm nur den Charakter einer Tendenz geben, weshalb wir auch den Fall der allgemeinen Profitrate als einen tendenziellen Fall bezeichnet haben. Die allgemeinsten dieser Ursachen sind folgende:

The problem inverted: why not faster

Think how enormously the productive power of social labour has grown in the last thirty years alone, compared with every earlier period, and above all how huge a mass of fixed capital now enters society's whole production process over and above machinery proper. The difficulty that used to occupy economists then turns into its opposite. Their problem was to explain the fall in the rate of profit; ours is the reverse: to explain why that fall is not bigger or quicker. Something must be working against it — influences that cut across and cancel the effect of the general law, leaving that law with nothing but the character of a tendency. That is why we have called the fall of the general rate of profit a tendential fall. The most general of these causes are the following.

Der Exploitationsgrad der Arbeit, die Aneignung von Mehrarbeit und Mehrwert wird erhöht namentlich durch Verlängerung des Arbeitstags und Intensifikation der Arbeit. Diese beiden Punkte sind ausführlich entwickelt in Buch I bei der Produktion des absoluten und des relativen Mehrwerts. Es gibt viele Momente der Intensifikation der Arbeit, die ein Wachstum des konstanten Kapitals gegen das variable, also Fall der Profitrate einschließen, wie wenn ein Arbeiter größre Masse von Maschinerie zu überwachen hat. Hier - wie bei den meisten Prozeduren, die zur Produktion des relativen Mehrwerts dienen - mögen dieselben Ursachen, die ein Wachstum in der Rate des Mehrwerts hervorbringen, einen Fall in der Masse des Mehrwerts, gegebne Größen von angewandtem Gesamtkapital betrachtet, einschließen. Aber es gibt andre Momente der Intensifikation, wie z.B. beschleunigte Geschwindigkeit der Maschinerie, die in derselben Zeit zwar mehr Rohmaterial vernutzen, aber was das fixe Kapital angeht, die Maschinerie zwar schneller aufnutzen, das Verhältnis ihres Werts zum Preis der Arbeit, die sie in Bewegung setzt, indes keineswegs affizieren. Namentlich aber ist es die Verlängerung des Arbeitstags, diese Erfindung der modernen Industrie, welche die Masse der angeeigneten Mehrarbeit vermehrt, ohne das Verhältnis der angewandten Arbeitskraft zu dem von ihr in Bewegung gesetzten konstanten Kapital wesentlich zu verändern, und welche in der Tat eher das letztere relativ vermindert. Sonst ist es bereits nachgewiesen - und bildet das eigentliche Geheimnis des tendenziellen Falls der Profitrate -, daß die Prozeduren zur Erzeugung von relativem Mehrwert im ganzen und großen darauf hinauslaufen: einerseits von einer gegebnen Masse Arbeit möglichst viel in Mehrwert zu verwandeln, andrerseits im Verhältnis zum vorgeschoßnen Kapital möglichst wenig Arbeit überhaupt anzuwenden; so daß dieselben Gründe, welche erlauben, den Exploitationsgrad der Arbeit zu erhöhen, es verbieten, mit demselben Gesamtkapital ebensoviel Arbeit wie früher zu exploitieren. Dies sind die widerstreitenden Tendenzen, die, während sie auf eine Steigerung in der Rate des Mehrwerts, gleichzeitig auf einen Fall der von einem gegebnen Kapital erzeugten Masse des Mehrwerts und daher der Rate des Profits hinwirken. Ebenfalls ist die massenhafte Einführung von Weiber- und Kinderarbeit soweit hier zu erwähnen, als die ganze Familie dem Kapital eine größre Masse Mehrarbeit liefern muß als vorher, selbst wenn die Gesamtsumme des ihr gegebnen Arbeitslohns wächst, was keineswegs allgemein der Fall. - Alles was die Produktion des relativen Mehrwerts fördert durch bloße Verbesserung der Methoden, wie in der Agrikultur, bei unveränderter Größe des angewandten Kapitals, hat dieselbe Wirkung. Hier steigt zwar nicht das angewandte konstante Kapital im Verhältnis zum variablen, soweit wir letzteres als Index der beschäftigten Arbeitskraft betrachten, aber es steigt die Masse des Produkts im Verhältnis zur angewandten Arbeitskraft. Dasselbe findet statt, wenn die Produktivkraft der Arbeit (einerlei ob ihr Produkt in die Konsumtion der Arbeiter eingeht oder in die Elemente des konstanten Kapitals) befreit wird von Verkehrshemmungen, willkürlichen oder im Lauf der Zeit störend gewordnen Einschränkungen, überhaupt von Fesseln aller Art, ohne daß dadurch zunächst das Verhältnis des variablen zum konstanten Kapital berührt wird.

The first cause: more exploitation

The degree of exploitation of labour — how much surplus labour and surplus-value get taken — is pushed up above all by making the working day longer and by making work more intense. Volume 1 sets both out in detail, under the production of absolute and of relative surplus-value.

Many ways of intensifying labour do raise constant capital as against variable capital, and so drag the profit rate down — for instance when one worker has to keep an eye on more machinery. In these cases, as with most of the ways of producing relative surplus-value, the very same reasons that make the rate of surplus-value rise can also make its mass fall, once the total capital applied is taken as given. But there are other ways of intensifying labour. Take machines running faster: they use up more raw material in the same time, and the machinery gets used up sooner as fixed capital — yet this does not in the least change how the machines' value stands to the price of the labour that sets them in motion.

Above all, though, it is the longer working day — this invention of modern industry — that increases the mass of surplus labour appropriated without essentially changing how much labour-power is applied relative to the constant capital that labour-power sets in motion; in fact it rather reduces that constant capital in relative terms. It has already been shown — and this is the genuine secret behind the tendential fall of the profit rate — that the procedures for producing relative surplus-value come down, by and large, to two things: turning as much as possible of a given mass of labour into surplus-value, and applying as little labour as possible in proportion to the capital advanced. So the very reasons that let the degree of exploitation of labour rise also forbid a capital to exploit as much labour as it did before, when its total size is unchanged. These are the conflicting pulls: while they push the rate of surplus-value up, they push down at the same time the mass of surplus-value a given capital produces — and with it the rate of profit. The large-scale use of women's and children's labour belongs here too, insofar as the whole family must now hand capital a greater mass of surplus labour than before, even if the total wages it receives go up — which is by no means always so.

Everything that helps produce relative surplus-value just by improving methods, with the size of the capital applied unchanged, has the same effect — in agriculture, say. Here the constant capital applied does not in fact rise against the variable — if we take the variable as an index (a gauge) of the labour-power employed — but the mass of product does rise against the labour-power applied. The same happens when the productivity of labour — whether its product is consumed by the workers or becomes part of the elements of constant capital — is freed from obstacles to trade, from arbitrary restrictions, or from ones that have grown irksome over time, in short from fetters of every kind, without this at first changing how variable capital stands to constant capital.

Es könnte die Frage aufgeworfen werden, ob in den, den Fall der Profitrate hemmenden, ihn in letzter Instanz aber stets beschleunigenden Ursachen einbegriffen sind die temporären, aber sich stets wiederholenden, bald in diesem, bald in jenem Produktionszweig auftauchenden Erhöhungen des Mehrwerts über das allgemeine Niveau für den Kapitalisten, der Erfindungen usw. benutzt, bevor sie verallgemeinert sind. Diese Frage muß bejaht werden.

Do temporary surplus-value rises count? Yes

It might be asked: do the causes that check the fall in the profit rate — though in the last instance they always speed it up — include those temporary but constantly recurring rises in surplus-value above the general level, the ones that turn up now in one branch of production, now in another, for the capitalist who uses inventions and the like before they have become general? That question has to be answered yes.

Die Masse des Mehrwerts, die ein Kapital von gegebner Größe erzeugt, ist das Produkt zweier Faktoren, der Rate des Mehrwerts multipliziert mit der Arbeiterzahl, die zur gegebnen Rate beschäftigt wird. Sie hängt also ab bei gegebner Rate des Mehrwerts von der Arbeiterzahl und bei gegebner Arbeiterzahl von der Rate des Mehrwerts, überhaupt also von dem zusammengesetzten Verhältnis der absoluten Größe des variablen Kapitals und der Rate des Mehrwerts. Nun hat sich gezeigt, daß im Durchschnitt dieselben Ursachen, die die Rate des relativen Mehrwerts erhöhen, die Masse der angewandten Arbeitskraft erniedrigen. Es ist aber klar, daß ein Mehr oder Minder hier eintritt, je nach dem bestimmten Verhältnis, worin diese gegensätzliche Bewegung sich vollzieht, und daß die Tendenz zur Verminderung der Profitrate namentlich geschwächt wird durch Erhöhung der Rate des absoluten, aus Verlängerung des Arbeitstags stammenden Mehrwerts.

Mass equals rate times workers

For a capital of a given size, the mass of surplus-value it produces is the product of two factors: the rate of surplus-value, and the number of workers employed at that rate. So if the rate is given, the mass depends on the number of workers; if the number of workers is given, it depends on the rate; overall, then, it depends on the combined relation of the two — the absolute size of the variable capital and the rate of surplus-value. Now we have seen that, on average, the same causes that push the rate of relative surplus-value up also bring down the mass of labour-power employed. But it is clear that the outcome can come out greater or smaller, depending on the particular proportions in which these opposed movements run, and that the tendency of the profit rate to fall is weakened above all by a rise in the rate of absolute surplus-value — the kind that comes from a longer working day.

Bei der Profitrate hat sich im allgemeinen gefunden, daß dem Sinken der Rate, wegen der steigenden Masse des angewandten Gesamtkapitals, die Zunahme der Profitmasse entspricht. Das gesamte variable Kapital der Gesellschaft betrachtet, ist der von ihm erzeugte Mehrwert gleich dem erzeugten Profit. Neben der absoluten Masse ist auch die Rate des Mehrwerts gewachsen; die eine, weil die von der Gesellschaft angewandte Masse Arbeitskraft gewachsen, die zweite, weil der Exploitationsgrad dieser Arbeit gewachsen. Aber mit Bezug auf ein Kapital von gegebner Größe, z.B. 100, kann die Rate des Mehrwerts wachsen, während die Masse im Durchschnitt fällt; weil die Rate bestimmt ist durch das Verhältnis, worin sich der variable Kapitalteil verwertet, die Masse dagegen bestimmt ist durch den Verhältnisteil, den das variable Kapital vom Gesamtkapital ausmacht.

Falling rate, rising mass

As for the rate of profit, what we found in general was that the rate going down is matched by the profit mass going up, because the total capital applied has grown. Look at the variable capital of society as a whole, and the surplus-value it yields is exactly the profit. Alongside the absolute mass, the rate of surplus-value has risen as well: the mass because society applies more labour-power, the rate because the degree of exploitation of that labour has gone up. But for a capital of a given size — 100, say — the rate of surplus-value can grow while its mass falls on average; the rate is fixed by the ratio at which the variable part of the capital expands its own value, while the mass is fixed by the share that variable capital makes up of the whole capital.

Das Steigen der Mehrwertsrate - da es namentlich auch unter Umständen stattfindet, wo, wie oben angeführt, keine oder keine verhältnismäßige Vermehrung des konstanten Kapitals gegen das variable stattfindet - ist ein Faktor, wodurch die Masse des Mehrwerts, und daher auch die Profitrate mit bestimmt wird. Er hebt nicht das allgemeine Gesetz auf. Aber er macht, daß es mehr als Tendenz wirkt, d.h. als ein Gesetz, dessen absolute Durchführung durch gegenwirkende Umstände aufgehalten, verlangsamt, abgeschwächt wird. Da aber dieselben Ursachen, die die Rate des Mehrwerts erhöhen (selbst die Verlängerung der Arbeitszeit ist ein Resultat der großen Industrie), dahin streben, die von einem gegebnen Kapital angewandte Arbeitskraft zu vermindern, so streben dieselben Ursachen zur Verminderung der Profitrate und zur verlangsamten Bewegung dieser Verminderung. Wenn einem Arbeiter die Arbeit aufgezwungen wird, die rationell nur zwei verrichten können, und wenn dies unter Umständen geschieht, wo dieser eine drei ersetzen kann, so wird der eine soviel Mehrarbeit liefern wie früher zwei, und sofern ist die Rate des Mehrwerts gestiegen. Aber er wird nicht soviel liefern wie vorher drei, und damit ist die Masse des Mehrwerts gefallen. Ihr Fall ist aber kompensiert oder beschränkt durch das Steigen der Rate des Mehrwerts. Wird die gesamte Bevölkerung zu gestiegner Rate des Mehrwerts beschäftigt, so steigt die Masse des Mehrwerts, obgleich die Bevölkerung dieselbe bleibt. Noch mehr bei wachsender Bevölkerung; und obgleich dies verbunden ist mit einem relativen Fall der beschäftigten Arbeiterzahl im Verhältnis zur Größe des Gesamtkapitals, so wird dieser Fall doch gemäßigt oder aufgehalten durch die gestiegne Rate des Mehrwerts.

Not annulled: law as tendency

The rise in the rate of surplus-value is one of the factors that helps determine the mass of surplus-value, and along with it the rate of profit — particularly since this rise also occurs in conditions where, as noted above, constant capital does not grow against variable capital, or does not grow proportionally to it. It does not annul the general law. But it makes the law work more as a tendency — that is, as a law whose full realization is held up, slowed down and weakened by forces working against it. And since the same factors that raise the rate of surplus-value (even a longer working day is a result of large-scale industry) tend to reduce the labour-power a given capital sets to work, the same factors tend to bring the profit rate down and to slow that downward movement. If one worker is forced to do work that two could sensibly do, and this happens where that one worker can replace three, then that one now delivers the same surplus labour as two did earlier, and to that extent the rate of surplus-value has risen. But he will not deliver as much as three did earlier, and so the mass of surplus-value has fallen. The fall is offset — or limited — by the fact that the rate of surplus-value has risen. If everyone works at a higher rate of surplus-value, the mass of surplus-value rises even though the population is unchanged. And still more so when the population grows; and although this comes with fewer workers employed relative to the size of the total capital, that fall is still moderated or held back by the higher rate of surplus-value.

Ehe wir diesen Punkt verlassen, ist noch einmal zu betonen, daß bei gegebner Größe des Kapitals die Rate des Mehrwerts wachsen kann, obgleich seine Masse fällt, und umgekehrt. Die Masse des Mehrwerts ist gleich der Rate multipliziert mit der Arbeiterzahl; die Rate wird aber nie auf das Gesamtkapital, sondern nur auf das variable Kapital berechnet, in der Tat nur auf je einen Arbeitstag. Dagegen kann bei gegebner Größe des Kapitalwerts die Profitrate nie steigen oder fallen, ohne daß die Masse des Mehrwerts ebenfalls steigt oder fällt.

Rate versus mass: the asymmetry

Before we leave this point, it is worth stressing again: with the size of the capital fixed, the rate of surplus-value can go up even while its mass goes down — and the reverse. The mass of surplus-value is the rate times the number of workers; but the rate is never reckoned on the total capital, only on the variable capital — in fact only on a single working day at a time. With the size of the capital value given, though, the rate of profit can never rise or fall without the mass of surplus-value rising or falling with it.

Dies wird hier nur empirisch angeführt, da es in der Tat, wie manches andre, was hier aufzuführen wäre, mit der allgemeinen Analyse des Kapitals nichts zu tun hat, sondern in die, in diesem Werk nicht behandelte, Darstellung der Konkurrenz gehört. Doch ist es eine der bedeutendsten Ursachen, die die Tendenz zum Fall der Profitrate aufhalten.

Empirical point, yet a major cause

The depressing of wages below the value of labour-power is brought in here only as an empirical observation, since in fact — like various other things that could be mentioned — it has no part in the general analysis of capital; it belongs to the account of competition, which this work does not give. Even so, it is one of the most significant causes that hold back the tendency of the profit rate to fall.

Alles was im ersten Abschnitt dieses Buchs über die Ursachen gesagt worden, die die Profitrate erhöhen bei konstanter Mehrwertsrate, oder unabhängig von der Mehrwertsrate, gehört hierher. Also namentlich, daß, das Gesamtkapital betrachtet, der Wert des konstanten Kapitals nicht in demselben Verhältnis wächst wie sein materieller Umfang. Z.B. die Baumwollmasse, die ein einzelner europäischer Spinnarbeiter in einer modernen Fabrik verarbeitet, ist gewachsen im kolossalsten Verhältnis zu dem, was ein europäischer Spinner früher mit dem Spinnrad verarbeitete. Aber der Wert der verarbeiteten Baumwolle ist nicht in demselben Verhältnis gewachsen wie ihre Masse. Ebenso mit den Maschinen und andrem fixen Kapital. Kurz, dieselbe Entwicklung, die die Masse des konstanten Kapitals steigert im Verhältnis zum variablen, vermindert, infolge der gesteigerten Produktivkraft der Arbeit, den Wert seiner Elemente, und verhindert daher, daß der Wert des konstanten Kapitals, obgleich beständig wachsend, im selben Verhältnis wachse wie sein materieller Umfang, d.h. der materielle Umfang der Produktionsmittel, die von derselben Menge Arbeitskraft in Bewegung gesetzt werden. In einzelnen Fällen kann sogar die Masse der Elemente des konstanten Kapitals zunehmen, während sein Wert gleich bleibt oder gar fällt.

More constant capital, cheaper elements

Everything said in Part One of this volume about the causes that raise the rate of profit while the rate of surplus-value stays the same — or that raise it regardless of that rate — belongs here. In particular the fact that, taking the total capital, the value of constant capital does not grow in step with its material volume. For example, the quantity of cotton that one European spinning operative works up in a modern factory has grown colossally, compared with what a European spinner once processed on a spinning wheel. But the value of the cotton worked up has not grown in the same proportion as its mass. The same holds for machines and other fixed capital. In short, the very development that makes constant capital a greater mass relative to variable capital pulls down the value of its elements, thanks to the greater productivity of labour. And so it keeps the value of constant capital — steadily growing though it is — from growing as fast as its material volume, that is, the sheer bulk of the means of production that the same quantity of labour-power sets moving. In individual cases the mass of the elements of constant capital can even grow while their value stays the same or falls.

Mit dem Gesagten hängt zusammen die mit der Entwicklung der Industrie gegebne Entwertung des vorhandnen Kapitals (d.h. seiner stofflichen Elemente). Auch sie ist eine der beständig wirkenden Ursachen, welche den Fall der Profitrate aufhalten, obgleich sie unter Umständen die Masse des Profits beeinträchtigen kann durch Beeinträchtigung der Masse des Kapitals, das Profit abwirft. Es zeigt sich hier wieder, daß dieselben Ursachen, welche die Tendenz zum Fall der Profitrate erzeugen, auch die Verwirklichung dieser Tendenz mäßigen.

The same factors, once again

Connected with all this is the devaluation of capital already in existence — that is, of its material elements — which comes with the development of industry. This too is one of the factors that work constantly to hold back the fall in the rate of profit, although in some circumstances it can eat into the mass of profit, by eating into how much capital there is to yield profit. Here we see once more that the same factors which produce the tendency of the profit rate to fall also moderate how far that tendency is realized.

Kap. 14

Drei Gegenursachen (II): relative Überbevölkerung, auswärtiger Handel, Aktienkapital

The list was opened, and the question turned round: the difficulty is no longer to explain the fall but to explain why it is not greater or faster. Three counterweights were entered there — rising exploitation, wages pressed below the value of labour-power, cheaper elements of constant capital. What comes now is the rest of the list, and with it the closing statement of what kind of law this is: one whose own causes call forth the effects that slow it. And it settles the account with Ricardo on profits earned abroad, before repeating two propositions that keep being confused.

Ihre Erzeugung ist unzertrennlich von der und wird beschleunigt durch die Entwicklung der Produktivkraft der Arbeit, die sich in der Abnahme der Profitrate ausdrückt. Die relative Überbevölkerung zeigt sich um so auffallender in einem Lande, je mehr die kapitalistische Produktionsweise in ihm entwickelt ist. Sie ist wiederum Grund, einerseits, daß in vielen Produktionszweigen die mehr oder minder unvollständige Unterordnung der Arbeit unter das Kapital fortdauert, und länger fortdauert, als dies dem allgemeinen Stand der Entwicklung auf den ersten Blick entspricht; es ist dies Folge der Wohlfeilheit und Masse der disponiblen oder freigesetzten Lohnarbeiter und des größern Widerstandes, den manche Produktionszweige, ihrer Natur nach, der Verwandlung von Handarbeit in Maschinenarbeit entgegensetzen. Andrerseits öffnen sich neue Produktionszweige, besonders auch für Luxuskonsumtion, die eben jene relative, oft durch Überwiegen des konstanten Kapitals in andren Produktionszweigen freigesetzte Bevölkerung als Basis nehmen, ihrerseits wieder auf Überwiegen des Elements der lebendigen Arbeit beruhn, und erst nach und nach dieselbe Karriere wie die andren Produktionszweige durchmachen. In beiden Fällen nimmt das variable Kapital eine bedeutende Proportion des Gesamtkapitals ein und ist der Arbeitslohn unter dem Durchschnitt, so daß sowohl Mehrwertsrate wie Mehrwertsmasse in diesen Produktionszweigen ungewöhnlich hoch sind. Da nun die allgemeine Profitrate durch die Ausgleichung der Profitraten in den besondren Produktionszweigen gebildet wird, bringt hier wieder dieselbe Ursache, die die fallende Tendenz der Profitrate erzeugt, ein Gegengewicht gegen diese Tendenz hervor, das ihre Wirkung mehr oder minder paralysiert.

the surplus population as counterweight

A country's relative surplus population is created by the same development of labour productivity that shows up as the decline in the profit rate: the two cannot be separated, and the growth of productivity speeds the surplus population up. And the more developed the capitalist mode of production is in a country, the more glaring that surplus population becomes there.

The surplus population is in turn one reason why, in many branches of production, labour stays more or less incompletely subordinated to capital — and stays that way longer than the general level of development would suggest at first glance. Two things lie behind that: wage-labourers are cheap and there are many of them, either available or already set free from work; and some branches put up more resistance, by their very nature, to being converted from hand labour into machine labour.

At the same time new branches open up, luxury production in particular. They take precisely this relative population as their base — a population that other branches have often set free because constant capital predominates there — and they in turn rest on a predominance of living labour. Only gradually do they go through the same career as the other branches. In both cases variable capital makes up a large share of the total capital and wages sit below the average, so that both the rate and the mass of surplus-value in these branches are unusually high.

The general profit rate, after all, comes about by equalizing the profit rates of the particular branches. So here again the very cause that produces the falling tendency of the profit rate produces a counterweight against that tendency, one that paralyses its effect to a greater or lesser degree.

Soweit der auswärtige Handel teils die Elemente des konstanten Kapitals, teils die notwendigen Lebensmittel, worin das variable Kapital sich umsetzt, verwohlfeilert, wirkt er steigernd auf die Profitrate, indem er die Rate des Mehrwerts hebt und den Wert des konstanten Kapitals senkt. Er wirkt überhaupt in diesem Sinn, indem er erlaubt, die Stufenleiter der Produktion zu erweitern. Damit beschleunigt er einerseits die Akkumulation, andrerseits aber auch das Sinken des variablen Kapitals gegen das konstante, und damit den Fall der Profitrate. Ebenso ist die Ausdehnung des auswärtigen Handels, obgleich in der Kindheit der kapitalistischen Produktionsweise deren Basis, in ihrem Fortschritt, durch die innere Notwendigkeit dieser Produktionsweise, durch ihr Bedürfnis nach stets ausgedehnterm Markt, ihr eignes Produkt geworden. Es zeigt sich hier wieder dieselbe Zwieschlächtigkeit der Wirkung. (Ricardo hat diese Seite des auswärtigen Handels ganz übersehn.)

foreign trade cuts both ways

Foreign trade cheapens two things: the elements that constant capital is made of, and the necessary means of subsistence that variable capital is turned into. To that extent it lifts the rate of profit, because surplus-value is extracted at a higher rate and constant capital is worth less. And it works in this direction generally, by letting production be carried on at a larger scale.

But that is not all it does. It speeds up accumulation, and at the same time it speeds up the sinking of variable capital relative to constant capital — and with that, the fall in the rate of profit.

There is a further twist. In the infancy of the capitalist mode of production, foreign trade was its basis. As that mode develops, foreign trade becomes its own product instead — forced by the inner necessity of this mode of production and by its need for markets that keep widening. Here again the same double-edged effect shows. (Ricardo completely overlooked this side of foreign trade.)

Eine andre Frage - die in ihrer Spezialität eigentlich jenseits der Grenze unsrer Untersuchung liegt - ist die: Wird die allgemeine Profitrate erhöht durch die höhere Profitrate, die das im auswärtigen und namentlich im Kolonialhandel angelegte Kapital macht?

a question beyond our limits

There is another question — one that, in its own specifics, properly lies beyond the bounds of this investigation: when capital placed in foreign trade — above all in colonial trade — earns a higher rate of profit, does that lift the general rate of profit?

Kapitale, im auswärtigen Handel angelegt, können eine höhere Profitrate abwerfen, weil hier erstens mit Waren konkurriert wird, die von andern Ländern mit mindren Produktionsleichtigkeiten produziert werden, so daß das fortgeschrittnere Land seine Waren über ihrem Wert verkauft, obgleich wohlfeiler als die Konkurrenzländer. Sofern die Arbeit des fortgeschrittnern Landes hier als Arbeit von höherm spezifischen Gewicht verwertet wird, steigt die Profitrate, indem die Arbeit, die nicht als qualitativ höhere bezahlt, als solche verkauft wird. Dasselbe Verhältnis kann stattfinden gegen das Land, wohin Waren gesandt und woraus Waren bezogen werden; daß dies nämlich mehr vergegenständlichte Arbeit in natura gibt, als es erhält, und daß es doch hierbei die Ware wohlfeiler erhält, als es sie selbst produzieren könnte. Ganz wie der Fabrikant, der eine neue Erfindung vor ihrer Verallgemeinerung benutzt, wohlfeiler verkauft als seine Konkurrenten, und dennoch über dem individuellen Wert seiner Ware verkauft, d.h., die spezifisch höhere Produktivkraft der von ihm angewandten Arbeit als Mehrarbeit verwertet. Er realisiert so einen Surplusprofit. Was andrerseits die in Kolonien etc. angelegten Kapitale betrifft, so können sie höhere Profitraten abwerfen, weil dort überhaupt wegen der niedrigen Entwicklung die Profitrate höher steht, und ebenfalls, bei Anwendung von Sklaven und Kulis etc., die Exploitation der Arbeit. Warum nun die höhern Profitraten, die in gewissen Zweigen angelegte Kapitale so abwerfen und nach der Heimat abführen, hier, wenn sonst nicht Monopole im Wege stehn, nicht in die Ausgleichung der allgemeinen Profitrate eingehn und daher diese pro tanto erhöhn sollen, ist nicht abzusehn.³⁶ Es ist dies namentlich nicht abzusehn, wenn jene Zweige der Kapitalanwendung unter den Gesetzen der freien Konkurrenz stehn. Was Ricardo dagegen vorschwebt, ist namentlich dies: mit dem im Ausland erzielten höheren Preis werden dort Waren gekauft und als Retour nach Hause geschickt; diese Waren werden also im Inland verkauft, und es kann dies daher höchstens eine temporäre Extrabevorteilung dieser begünstigten Sphären der Produktion über andre ausmachen. Dieser Schein fällt weg, sobald von der Geldform abgesehn wird. Das begünstigte Land erhält mehr Arbeit zurück im Austausch für weniger Arbeit, obgleich diese Differenz, dies Mehr, wie beim Austausch zwischen Arbeit und Kapital überhaupt, von einer gewissen Klasse eingesackt wird. Soweit also die Profitrate höher ist, weil sie überhaupt höher in dem Kolonialland, mag dies bei günstigen Naturbedingungen desselben mit niedren Warenpreisen Hand in Hand gehn. Ausgleichung findet statt, aber nicht Ausgleichung zum alten Niveau, wie Ricardo meint.

why colonial profits enter the average

Capital placed in foreign trade may bring in a higher rate of profit. First, because it competes with goods produced in other countries where production is less easy: the more advanced country sells its output above its value, though it still undersells its rivals. In so far as the labour of the more advanced country counts here as labour of a higher specific weight — heavier labour, worth more per hour — the rate of profit rises — labour that is not paid for as the better sort is all the same sold as the better sort.

The same relationship can hold the other way round, towards the country that goods are sent to and bought from: that country hands over more objectified labour in kind — more labour embodied in actual goods — than it receives back, and yet it still gets the goods cheaper than it could have made them itself. It is just like a manufacturer who uses a new discovery before it becomes general: he undercuts his competitors and still sells above the individual value of his own commodity — he cashes in the unusually high productivity of his workers as surplus labour. In this way he realizes a surplus profit.

As for capital invested in the colonies and the like, it can yield higher rates of profit because the rate of profit generally stands higher there, given how little developed the country is, and also because labour is more harshly exploited — with slaves and coolies, and so on. Unless monopolies block the way, there is no seeing why the higher profit rates earned by capital placed in certain branches, and sent back home, should not go into the equalization of the general rate of profit and push it up to that extent. Especially not when free competition rules in those branches.

What Ricardo has in mind is something else: the higher price obtained abroad is used to buy goods there, and those goods come home as return cargo and are sold on the domestic market. So at most this gives the favoured branches a temporary edge over the rest. But once we leave the money form behind, that semblance vanishes. The privileged country hands over less labour and gets more back — though the difference, that excess, gets scooped up by one particular class, exactly as happens in the exchange between labour and capital at large.

So where the rate of profit is higher simply because rates are generally higher in the colonial country, good natural conditions there may go together with cheap commodities. Equalization does happen — but it does not equalize back to the old level, as Ricardo thinks.

Derselbe auswärtige Handel aber entwickelt im Inland die kapitalistische Produktionsweise, und damit die Abnahme des variablen Kapitals gegenüber dem konstanten, und produziert auf der andern Seite Überproduktion mit Bezug auf das Ausland, hat daher auch wieder im weitern Verlauf die entgegengesetzte Wirkung.

the same trade flips over

But the same foreign trade also develops the capitalist mode of production at home, and with it the decline of variable capital compared with constant capital. On its other side it produces overproduction in relation to foreign countries, so that in its further course it has the opposite effect once more.

Und so hat sich denn im allgemeinen gezeigt, daß dieselben Ursachen, die das Fallen der allgemeinen Profitrate hervorbringen, Gegenwirkungen hervorrufen, die diesen Fall hemmen, verlangsamen und teilweise paralysieren. Sie heben das Gesetz nicht auf, schwächen aber seine Wirkung ab. Ohne das wäre nicht das Fallen der allgemeinen Profitrate unbegreiflich, sondern umgekehrt die relative Langsamkeit dieses Falls. So wirkt das Gesetz nur als Tendenz, dessen Wirkung nur unter bestimmten Umständen und im Verlauf langer Perioden schlagend hervortritt.

the law's mode of existence

So it has come out in general that the very causes which bring the general profit rate down also call forth counter-effects: effects that hold this fall back, slow it down and partly paralyse it. They weaken the law's effect without doing away with it. Without them, it would not be the profit rate's fall that was incomprehensible; the puzzle would be the opposite — why that fall is relatively so slow. So the law works only as a tendency, and its effect makes itself felt with full force only in certain circumstances and across long stretches of time.

Ehe wir nun weitergehn, wollen wir zur Vermeidung von Mißverständnis noch zwei mehrfach entwickelte Sätze wiederholen.

two points repeated to prevent confusion

Before we go further, let us repeat two points that have already been worked out more than once, so as to head off any misunderstanding.

Erstens: Derselbe Prozeß, der die Verwohlfeilerung der Waren im Entwicklungsgang der kapitalistischen Produktionsweise erzeugt, erzeugt eine Veränderung in der organischen Zusammensetzung des zur Produktion der Waren angewandten gesellschaftlichen Kapitals, und infolgedessen den Fall der Profitrate. Man muß also die Verminderung der relativen Kost der einzelnen Ware, auch des Teils dieser Kost, der Verschleiß von Maschinerie enthält, nicht identifizieren mit dem steigenden Wert des konstanten Kapitals, verglichen mit dem variablen, obgleich umgekehrt jede Verminderung in der relativen Kost des konstanten Kapitals, bei gleichbleibendem oder wachsendem Umfang seiner stofflichen Elemente, auf die Erhöhung der Profitrate, d.h. auf Verminderung pro tanto im Wert des konstanten Kapitals, verglichen mit dem in sinkenden Proportionen angewandten variablen Kapital, wirkt.

cheap goods are not cheap capital

First: the very same process that brings commodities down in price in the course of capitalist development also alters the organic composition of the social capital applied in producing those commodities, and with it lowers the rate of profit. So the falling relative cost of a single commodity — including the part of that cost that is wear and tear of machinery — must not be identified with the rising value of constant capital compared with variable. The converse does hold: if constant capital's relative cost falls while the sheer amount of its material elements stays level or grows, that pushes the rate of profit up — that is, it brings down to that extent the value of constant capital compared with the variable capital, which is applied in shrinking proportions.

Zweitens: Der Umstand, daß in den einzelnen Waren, aus deren Gesamtheit das Produkt des Kapitals besteht, die enthaltne zusätzliche lebendige Arbeit in einem abnehmenden Verhältnis zu den in ihnen enthaltnen Arbeitsstoffen und den in ihnen konsumierten Arbeitsmitteln steht; der Umstand also, daß ein stets abnehmendes Quantum zusätzlicher lebendiger Arbeit in ihnen vergegenständlicht ist, weil weniger Arbeit zu ihrer Produktion erheischt mit Entwicklung der gesellschaftlichen Produktionskraft - dieser Umstand trifft nicht das Verhältnis, worin sich die in der Ware enthaltne lebendige Arbeit in bezahlte und unbezahlte teilt. Umgekehrt. Obgleich das Gesamtquantum der in ihr enthaltnen zusätzlichen lebendigen Arbeit fällt, wächst der unbezahlte Teil im Verhältnis zum bezahlten, entweder durch absolutes oder proportionelles Sinken des bezahlten Teils; denn dieselbe Produktionsweise, die die Gesamtmasse der zusätzlichen lebendigen Arbeit in einer Ware vermindert, ist begleitet vom Steigen des absoluten und relativen Mehrwerts. Das tendenzielle Sinken der Profitrate ist verbunden mit einem tendenziellen Steigen in der Rate des Mehrwerts, also im Exploitationsgrad der Arbeit. Nichts alberner daher, als das Sinken der Profitrate aus einem Steigen in der Rate des Arbeitslohns zu erklären, obgleich auch dies ausnahmsweise der Fall sein mag. Die Statistik wird erst durch Verständnis der Verhältnisse, die die Profitrate bilden, befähigt, wirkliche Analysen über die Rate des Arbeitslohns in verschiednen Epochen und Ländern vorzunehmen. Die Profitrate fällt nicht, weil die Arbeit unproduktiver, sondern weil sie produktiver wird. Beides, Steigen der Rate des Mehrwerts und Fallen der Rate des Profits, sind nur besondre Formen, worin sich wachsende Produktivität der Arbeit kapitalistisch ausdrückt.

the fall rides with rising exploitation

Second. Take the individual commodities that together make up the product of capital. The extra living labour they contain keeps shrinking relative to the materials of labour (the stuff worked up) they contain and the means of labour (the tools and machines) used up in making them; an ever smaller amount of extra living labour gets stored up in them, because as society's productive power grows, less labour is needed to produce them. None of this touches how the living labour inside the commodity splits between paid and unpaid. Quite the reverse.

Even though the total amount of extra living labour in the commodity falls, the unpaid part grows in relation to the paid part — either because the paid part falls absolutely or because it falls proportionally. For the very way of producing that cuts the total amount of extra living labour in a commodity goes hand in hand with absolute and relative surplus-value both rising.

So the profit rate's tendential fall goes together with a rise — itself tendential — in the rate of surplus-value, that is, in the degree to which labour is exploited. Nothing could be sillier, then, than to account for a falling profit rate by saying wages have risen — though by way of exception that may be the case. Only when we understand what shapes the profit rate can statistics genuinely analyse wage rates in different periods and countries.

It is not declining productivity of labour that pulls the profit rate down; it is labour becoming more productive. Both movements — the rate of surplus-value climbing, the profit rate sinking — are only particular shapes taken by labour's growing productivity under capitalism.

Den obigen fünf Punkten kann noch hinzugefügt werden der folgende, worauf aber zunächst nicht tiefer eingegangen werden kann. Ein Teil des Kapitals wird im Fortschritt der kapitalistischen Produktion, der mit beschleunigter Akkumulation Hand in Hand geht, nur als zinstragendes Kapital berechnet und angewandt. Nicht in dem Sinne, worin jeder Kapitalist, der Kapital ausleiht, sich mit den Zinsen begnügt, während der industrielle Kapitalist den Unternehmergewinn einsteckt. Dies geht die Höhe der allgemeinen Profitrate nichts an, denn für sie ist der Profit = Zins + Profit aller Art + Grundrente, deren Verteilung in diese besondren Kategorien für sie gleichgültig ist. Sondern in dem Sinn, daß diese Kapitale, obgleich in große produktive Unternehmungen gesteckt, nach Abzug aller Kosten nur große oder kleine Zinsen, sogenannte Dividenden abwerfen. Z.B. in Eisenbahnen. Sie gehn also nicht in die Ausgleichung der allgemeinen Profitrate ein, da sie eine geringre als die Durchschnittsprofitrate abwerfen. Gingen sie ein, so sänke diese viel tiefer. Theoretisch betrachtet, kann man sie einrechnen, und erhält dann eine geringre Profitrate als die scheinbar existierende und die Kapitalisten wirklich bestimmende, da gerade in diesen Unternehmungen des konstante Kapital im Verhältnis zum variablen am größten.

railways and the rate that counts

A sixth point can be added to the five above, though we cannot go deeper into it for now. As capitalist production advances — and it advances hand in hand with accelerated accumulation — one part of capital is reckoned and applied only as interest-bearing capital.

Not in the sense that a capitalist who lends out money is content with the interest while the one running the business keeps the entrepreneurial profit. That has nothing to do with the level of the general rate of profit, for as far as that rate is concerned, profit = interest + profit of every kind + ground-rent, and how the total is divided among those particular categories makes no difference to it.

It is rather in this sense: these capitals, even when they are put into large productive undertakings, yield, once all costs are taken off, only a larger or smaller interest — what are called dividends. Railways, for instance. So they take no part in the equalization that forms the general profit rate, because they bring in less than the average rate of profit. If they did go in, that rate would sink much lower.

Looked at theoretically, you can count them in, and then you get a profit rate lower than the one that apparently exists and really governs the capitalists — precisely because it is in undertakings like these that constant capital is greatest in relation to variable capital.

Kap. 14

Three Counteracting Causes (I): the Degree of Exploitation, Wages, and the Cheapening of the Elements of Constant Capital

If we consider the enormous development in the productive powers of social labour over the last thirty years alone, compared with all earlier periods, and particularly if we consider the enormous mass of fixed capital involved in the overall process of social production quite apart from machinery proper, then instead of the problem that occupied previous economists, the problem of explaining the fall in the profit rate, we have the opposite problem of explaining why this fall is not greater or faster. Counteracting influences must be at work, checking and cancelling the effect of the general law and giving it simply the character of a tendency, which is why we have described the fall in the general rate of profit as a tendential fall. The most general of these factors are as follows.

The problem inverted: why not faster

The level of exploitation of labour, the appropriation of surplus labour and surplus-value, can be increased by prolonging the working day and making work more intense. These points have been developed in detail in Volume 1, in connection with the production of absolute and relative surplus-value. There are many aspects to the intensification of labour that involve a growth in the constant capital as against the variable, i.e. a fall in the rate of profit, such as when a single worker has to supervise a larger amount of machinery. In this case, as also with most procedures that serve to produce relative surplus-value, the same reasons that bring about a rise in the rate of surplus-value can also involve a fall in its mass, taking given magnitudes of total capital applied. There are also other factors in this intensification, as for example the accelerated speed of the machines, which will use up more raw material in the same space of time, but, as far as the fixed capital is concerned, the fact that this wears out the machines that much faster does not in any way affect the ratio of their value to the price of the labour that sets them in motion. In particular, however, it is the prolongation of the working day, this discovery of modern industry, which increases the amount of surplus labour appropriated without basically altering the ratio of the labour-power applied to the constant capital that this sets in motion, and which in point of fact rather reduces the constant capital in relative terms. It has already been shown, moreover, and this forms the real secret of the tendential fall in the rate of profit, that the procedures for producing relative surplus-value are based, by and large, either on transforming as much as possible of a given amount of labour into surplus-value or on spending as little as possible labour in general in relation to the capital advanced; so that the same reasons that permit the level of exploitation of labour to increase make it impossible to exploit as much labour as before with the same total capital. These are the counteracting tendencies which, while they act to bring about a rise in the rate of surplus-value, simultaneously lead to a fall in the mass of surplus-value produced by a given capital, hence a fall in the rate of profit. The introduction of female and child labour on a mass scale should be mentioned here too, in so far as the family as a whole has now to supply capital with a greater quantity of surplus labour than before, even if the sum of their wages increases, which is by no means always the case.

Everything that promotes the production of relative surplus-value by the simple improvement of methods, without a change in the magnitude of capital applied, has the same effect — in agriculture for example. Even though the constant capital applied does not grow here in proportion to the variable, there is still a rise in the volume of the product in relation to the labour-power applied. The same thing takes place if the productivity of labour (irrespective of whether its product goes into the consumption of the workers or into the elements of constant capital) is freed from restraints on commerce, arbitrary restrictions, or limitations which have become irksome in the course of time, and generally from fetters of any kind, without any initial impact on the proportion of variable to constant capital.

The first cause: more exploitation

It might be asked whether these factors that inhibit the fall in the profit rate, though in the final instance they always accelerate it further, include the temporary but ever repeated increases in surplus-value that appear now in this branch of production, now in that, and raise it above the general level for the capitalist who makes use of inventions, etc. before they are universally applied. This question must be answered in the affirmative.

Do temporary surplus-value rises count? Yes

The mass of surplus-value that a capital of given size produces is the product of two factors, the rate of surplus-value and the number of workers employed at this rate. With a given rate of surplus-value, therefore, it depends on the number of workers, and with a given number of workers it depends on the rate — in general, therefore, it depends on the product of the absolute size of the variable capital and the rate of surplus-value. Now we have seen that the same factors that increase the rate of relative surplus-value lower the amount of labour-power applied on average. It is evident, however, that this effect can be greater or less, depending on the specific proportions in which this antithetical movement takes place, and that the tendency for the profit rate to be reduced, in particular, is attenuated by the increase in the rate of absolute surplus-value that stems from the prolongation of the working day.

Mass equals rate times workers

In connection with the profit rate, we have found that to a fall in the rate, resulting from a rise in the mass of total capital applied, there corresponds in general an increase in the amount of profit. Taking the total variable capital of the society as a whole, the surplus-value it produces is the same as the profit. Besides the absolute amount of surplus-value, the rate of surplus-value has also risen; the former because the amount of labour-power applied by the society has grown and the latter because the level of exploitation of this labour has increased. But with respect to a capital of given magnitude, e.g. 100, the rate of surplus-value can grow while the average mass of surplus-value falls, since the rate is determined by the ratio in which the variable portion of the capital is valorized, while the mass is determined by the proportion that the variable capital forms in the total.

Falling rate, rising mass

The rise in the rate of surplus-value — particularly since it takes place under circumstances in which, as mentioned above, there is no increase in the constant capital as against the variable, or no relative increase — is a factor which contributes to the determination of the mass of surplus-value and hence also the rate of profit. It does not annul the general law. But it has the effect that this law operates more as a tendency, i.e. as a law whose absolute realization is held up, delayed and weakened by counteracting factors. However, as the same factors that increase the rate of surplus-value (and the extension of the working day is itself a result of large-scale industry) tend to reduce the amount of labour-power employed by a given capital, the same factors tend both to reduce the rate of profit and to slow down the movement in this direction. If one worker is compelled to do work that it would really be rational for two to perform, and if this happens under circumstances in which this one worker can replace three, then one worker can now provide as much surplus labour as two did before, and to this extent the rate of surplus-value rises. But this one will not supply as much surplus labour as three did before, and this makes the mass of surplus-value fall. Its fall is compensated for or limited by the rise in the rate of surplus-value. If the entire population is set to work at the increased rate of surplus-value, the mass of surplus-value rises, even though the population remains the same. Still more is this the case with a growing population; and even though this growth is linked with a relative fall in the number of workers employed, compared with the size of the total capital, the fall is still moderated or halted by the higher rate of surplus-value.

Not annulled: law as tendency

Before we leave this point, it should be stressed once again that the rate of surplus-value can rise, with a constant amount of capital, even though the mass of surplus-value falls — and vice versa. The mass of surplus-value is equal to the rate multiplied by the number of workers; but the rate is never calculated on the total capital, but only on the variable capital, in actual fact on each working day individually. Once the size of the capital value is given, however, the rate of profit can never rise or fall without a similar rise or fall in the mass of surplus-value.

Rate versus mass: the asymmetry

We simply make an empirical reference to this point here, as, like many other things that might be brought in, it has nothing to do with the general analysis of capital, but has its place in an account of competition, which is not dealt with in this work. It is none the less one of the most important factors in stemming the tendency for the rate of profit to fall.

Empirical point, yet a major cause

Everything is relevant here that has been said in Part One of this volume about the causes that raise the rate of profit while the rate of surplus-value remains constant, or at least raise it independently of the latter. In particular, therefore, the fact that, viewing the total capital as a whole, the value of the constant capital does not increase in the same proportion as its material volume. For example, the quantity of cotton that a single European spinning operative works up in a modern factory has grown to a most colossal extent in comparison with that which a European spinner used to process with the spinning wheel. But the value of the cotton processed has not grown in the same proportion as its mass. It is the same with machines and other fixed capital. In other words, the same development that raises the mass of constant capital in comparison with variable reduces the value of its elements, as a result of the higher productivity of labour, and hence prevents the value of the constant capital, even though this grows steadily, from growing in the same degree as its material volume, i.e. the material volume of the means of production that are set in motion by the same amount of labour-power. In certain cases, the mass of the constant capital elements may increase while their total value remains the same or even falls.

More constant capital, cheaper elements

Also related to what has been said is the devaluation of existing capital (i.e. of its material elements) that goes hand in hand with the development of industry. This too is a factor that steadily operates to stay the fall in the rate of profit, even though in certain circumstances it may reduce the mass of profit by detracting from the mass of capital that produces profit. We see here once again how the same factors that produce the tendency for the rate of profit to fall also moderate the realization of this tendency.

The same factors, once again

Kap. 14

Three Counteracting Causes (II): Relative Surplus Population, Foreign Trade, and Share Capital

The creation of such a surplus population is inseparable from the development of labour productivity and is accelerated by it, the same development as is expressed in the decline in the profit rate. The more the capitalist mode of production is developed in a country, the more strikingly does the relative surplus population obtrude there. It is in turn a reason why the more or less incomplete subordination of labour to capital persists in several branches of production, and longer indeed than would seem to correspond at first sight to the general level of development; this is a result of the cheapness and quantity of available or dismissed wage-labourers and of the greater resistance that many branches of production, by their nature, oppose to the transformation of manual work into machine production. Furthermore, new branches of production open up, particularly in the field of luxury consumption, which precisely take this relative surplus population as their basis, a population often made available owing to the preponderance of constant capital in other branches of production; these base themselves in turn on a preponderance of the element of living labour, and only gradually pass through the same trajectory as other branches. In both cases variable capital forms a significant proportion of the total and wages are below the average, so that both the rate and mass of surplus-value in these branches of production are unusually high. Now since the general rate of profit is formed by the equalization of the rates of profit in the various particular branches of production, here again the same reasons that produce the tendential fall in the rate of profit also produce a counterweight to this tendency, which paralyses its effect to a greater or lesser extent.

the surplus population as counterweight

In so far as foreign trade cheapens on the one hand the elements of constant capital and on the other the necessary means of subsistence into which variable capital is converted, it acts to raise the rate of profit by raising the rate of surplus-value and reducing the value of constant capital. It has a general effect in this direction in as much as it permits the scale of production to be expanded. In this way it accelerates accumulation, while it also accelerates the fall in the variable capital as against the constant, and hence the fall in the rate of profit. And whereas the expansion of foreign trade was the basis of capitalist production in its infancy, it becomes the specific product of the capitalist mode of production as this progresses, through the inner necessity of this mode of production and its need for an ever extended market. Here again we can see the same duality of effect. (Ricardo completely overlooked this aspect of foreign trade.)

foreign trade cuts both ways

There is a further question, whose specific analysis lies beyond the limits of our investigation: is the general rate of profit raised by the higher profit rate made by capital invested in foreign trade, and colonial trade in particular?

a question beyond our limits

Capital invested in foreign trade can yield a higher rate of profit, firstly, because it competes with commodities produced by other countries with less developed production facilities, so that the more advanced country sells its goods above their value, even though still more cheaply than its competitors. In so far as the labour of the more advanced country is valorized here as labour of a higher specific weight, the profit rate rises, since labour that is not paid as qualitatively higher is nevertheless sold as such. The same relationship may hold towards the country to which goods are exported and from which goods are imported: i.e. such a country gives more objectified labour in kind than it receives, even though it still receives the goods in question more cheaply than it could produce them itself. In the same way, a manufacturer who makes use of a new discovery before this has become general sells more cheaply than his competitors and yet still sells above the individual value of his commodity, valorizing the specifically higher productivity of the labour he employs as surplus labour. He thus realizes a surplus profit. As far as capital invested in the colonies, etc. is concerned, however, the reason why this can yield higher rates of profit is that the profit rate is generally higher there on account of the lower degree of development, and so too is the exploitation of labour, through the use of slaves and coolies, etc. Now there is no reason why the higher rates of profit that capital invested in certain branches yields in this way, and brings home to its country of origin, should not enter into the equalization of the general rate of profit and hence raise this in due proportion, unless monopolies stand in the way. ³⁶ There is in particular no reason why this should not be so when the branches of capital investment in question are subject to the laws of free competition. What Ricardo has in mind, on the other hand, is this: higher prices are obtained abroad; commodities are bought there and sent home in exchange; these commodities are therefore sold on the domestic market, so that the favoured spheres of production can have at most a temporary advantage over others. As soon as we take our leave of the money form, however, this semblance vanishes. The privileged country receives more labour in exchange for less, even though this difference, the excess, is pocketed by a particular class, just as in the exchange between labour and capital in general. Thus in as much as the profit rate is higher because it is generally higher in the colonial country, favourable natural conditions there may enable it to go hand in hand with lower commodity prices. An equalization still takes place, but not an equalization at the old level, as Ricardo believes.

why colonial profits enter the average

But this same foreign trade develops the capitalist mode of production at home, and hence promotes a decline in variable capital as against constant, though it also produces overproduction in relation to the foreign country, so that it again has the opposite effect in the further course of development.

the same trade flips over

We have shown in general, therefore, how the same causes that bring about a fall in the general rate of profit provoke counter-effects that inhibit this fall, delay it and in part even paralyse it. These do not annul the law, but they weaken its effect. If this were not the case, it would not be the fall in the general rate of profit that was incomprehensible, but rather the relative slowness of this fall. The law operates therefore simply as a tendency, whose effect is decisive only under certain particular circumstances and over long periods.

the law's mode of existence

Before we proceed any further, we should like to repeat again two points that have already been developed several times, in order to avoid any misunderstanding.

two points repeated to prevent confusion

Before we go further, let us repeat two points that have already been worked out more than once, so as to head off any misunderstanding.

Firstly, the same process that leads to the cheapening of commodities as the capitalist mode of production develops leads to a change in the organic composition of the social capital applied in commodity production, and leads as a result to a fall in the profit rate. Thus the reduction in the relative cost of the individual commodity, or even in the part of this cost that represents the wear and tear of the machinery, should not be confused with the rising value of the constant capital compared with the variable, even though, conversely, any reduction in the relative cost of the constant capital, with the volume of its material elements remaining the same or increasing, acts to increase the rate of profit, i.e. acts to reduce proportionately the value of the constant capital, compared with the variable capital that is applied on a scale which declines progressively.

cheap goods are not cheap capital

Secondly, the fact that the additional living labour contained in the individual commodities which together compose the product of capital stands in a declining ratio to the materials of labour these contain and the means of labour consumed in them; the fact, therefore, that an ever smaller quantity of additional living labour is objectified in them, because less labour is required for their production as social productivity develops — this fact does not affect the proportion in which the living labour contained in the commodity is divided between paid and unpaid. On the contrary. Even though the total amount of the additional living labour contained in it falls, the unpaid part still grows in proportion to the paid part, either by an absolute or a proportionate fall in this paid part; for the same mode of production that reduces the total mass of additional living labour in a commodity is accompanied by a rise in absolute and relative surplus-value. The tendential fall in the rate of profit is linked with a tendential rise in the rate of surplus-value, i.e. in the level of exploitation of labour. Nothing is more absurd, then, than to explain the fall in the rate of profit in terms of a rise in wage rates, even though this too may be an exceptional case. Only when the relationships that form the rate of profit have been understood will statistics be able to put forward genuine analyses of wage-rates in different periods. The profit rate does not fall because labour becomes less productive but rather because it becomes more productive. The rise in the rate of surplus-value and the fall in the rate of profit are simply particular forms that express the growing productivity of labour in capitalist terms.

the fall rides with rising exploitation

The above five points can also be supplemented by the following one, though we cannot go any deeper into it at this point. As capitalist production advances, and with it accelerated accumulation, one portion of capital is considered simply to be interest-bearing capital and is invested as such. This is not in the sense in which any capitalist who loans out capital is content to take the interest, while the industrial capitalist pockets the entrepreneurial profit. Nor does it affect the level of the general rate of profit, for as far as this is concerned, profit = interest + profit of all kinds + ground-rent, its distribution between these particular categories being a matter of indifference. It is rather in the sense that these capitals, although invested in large productive enterprises, simply yield an interest, great or small, after all costs are deducted — so-called ‘dividends’. This is the case with railways, for example. These do not therefore enter into the equalization of the general rate of profit, since they yield a profit rate less than the average. If they did go in, the average rate would fall much lower. From a theoretical point of view, it is possible to include them, and we should then obtain a profit rate lower than that which apparently exists and is really decisive for the capitalists, since it is precisely in these undertakings that the proportion of constant capital to variable is at its greatest.

railways and the rate that counts