» NEIL SMITH: Brings me back to your
your point earlier about the the last chapters in Capital. There's the primitive accumulation chapter
of course, but I was thinking as much about the chapter on colonies and Wakefield, and
the sense of you get from Marx's critique of Wakefield which is that the realities of the system become extraordinarily more vivid and apparent at a distance from the center. » DAVID HARVEY: Yeah, I think this is
Marx' answer to… Hegel had a little thing about the formation of colonies and some kind of level of imperialism might be a
solution to the contradictions of capitalism, 'cause Hegel had a sense that capitalism was a very contradictory force and
he thought there may be a resolution that way. What Marx does, is basically to say "no", there is no such thing all you do is replicate the contradictions of capitalism
on a broader scale, you make it global, you take the contradictions global and you see contemporary China, I think something of that sort is exactly happening know. So, in a sense again what Marx does back in 1867, is to write this thing which is incredibly prophetic about where the
world is gonna go and how it's gonna go. And it's just so (…) But again one of the things about teaching it all this time, if I could go back to that for a moment, is that it's far easier to take the text of Capital right now and integrate it with stuff from the newspapers, stuff going on around us,
all of the time. It's far easier to do that now than it was maybe in the early 1970s, when the struggles were anti-imperialist struggles, the civil rights struggle, some struggles around labor but labor was
relatively strong in that period not only in the United States but also in Europe. And there were these revolutions in Europe, like
in Portugal and so on, and most of us thought that socialism was just around the corner! The eighth part departs somewhat from the scenery as it's constructed earlier on. What's going on in the early part, the first seven parts, is a dialogue with what you would call Smithian utopianism. A world in which, as he puts it, "Freedom, Equality, Property and Bentham" have their sway and do their thing. Now Marx knows perfectly well that we don't live in a world like that but it was, of course, the central argument of
classical political economy that, if only the world could be constructed like that
then the hidden hand of the market would ensure that capitalist development would work to the benefit of all. So Marx accepts Smith's assumptions as you'll recall in Chapter 2, where he says 'theres an atomistic market' and then later on there's that line about equality, freedom, property and Bentham. But what Marx shows is that step-by-step, logically - logically - logically, by the time you get to Chapter 25 you see two consequences of the implementation of such a utopian vision. And one is a minor consequence and the other
is a major consequence. The minor consequence is that we're likely to see this highly decentralized, individualistic system gradually displaced by an increasing centralization of capital. That, as he puts it elsewhere, the end result of competition is inevitably some form of monopoly or oligopoly, and that therefore the end result of the Smithian world is going to be to destroy the idea of individualism and the competitive basis of that individualism. The major consequence however is quite simply that the rich grow richer and the poor grow poorer. As he puts it, we see when this system is implemented, the accumulation of wealth at one pole, on the part of capital and accumulation of degradation, misery and the like,
on the part of that other pole i.e the part of the working class that has produced the wealth and has effectively been deprived of it by the dynamics of capitalist property relations and appropriation procedures. Now in a sense, I think you could summarize
this by saying 'this is an incredibly sophisticated essay on the theme that there is nothing more unequal than the equal treatment of unequals'. In a sense, of course, he's made a lot of the fact that the market system is egalitarian. 'Equality', 'freedom', and the reason there is nothing more unequal than being deprived under a system of that kind is that it's very easy to be gulled, as it were, into the illusions about liberty and freedom that this system promotes. That, indeed, the market system is about equality and freedom. And most of us would probably consider those primary virtues. We might go so far to say that there is indeed a case for private property. We might do without Bentham, but nevertheless this would look to us from the outside like a virtuous system. And its easy to persuade us all of the virtues of this system. And historically that of course is what capitalist class propaganda
and discourse has been very active in doing. But the consequences are this increasing inequality and this increasing centralization of power. I think it's interesting to reflect for a moment on
where we've been for the last thirty years since the beginnings of, if you like, the Neoliberal assault, which has precisely peddled the virtues of the free-market system, of private property rights and has constantly preached, as Bush has, about freedom and liberty, and to a lesser degree of equality and then consider what the consequences
have been and ask yourself the question: Is capital more centralized
now than it was thirty years ago?, in areas like pharmaceuticals, media, banking, energy, and all the rest of it. And I think you would pretty much come to the conclusion that on that score there has been a very marked trend towards increasing centralization of capital and an increasing centralization of power. When you look at the data on inequality you see the ratio between what the CEO got relative to the remuneration of an average employee in a corporation in 1970, and it was around 30 : 1. Now in the United States it is closer to 500 : 1 and
there have been times when it got closer to 1,000 : 1. The concentration of wealth in the top 0.1 percent of the population of the United States has doubled of the last twenty five years. The concentration of wealth among the top 0.01 percent has tripled
over the last twenty five years. And whenever Neoliberalism has struck, you immediately see the emergence of a fabulously wealthy elite. Mexico is one of my favorite examples, before the grand privatization schemes of Salinas in 1980 to '82-84 you wouldn't find any Mexicans on the Forbes wealthiest list, now you'll find fourteen of them and the richest man in the
world is reputed now to be Carlos Slim, who made all his money out of the
privatization schemes of the Salinas administration. You will find many other examples as
you go around, the degree of Neo-liberalization has had immense impact on the distribution of wealth and income in society. So on this ground i think you would argue that Marx has made a plausible case, that the closer we get towards the implementation of the Neoliberal utopian dream, the more we are likely to realize these particular consequences. On that point at least we can see something very important in terms of the analysis. But now we come to part eight where there's nothing here about Freedom, Equality and Bentham and all the rest of it. It's really about a certain history of violent appropriation,
of predatory behaviors, none of which can be legitimized through the market, or understood as being legitimate in terms of the rules of market exchange,
that Adam Smith's utopia required. So we see a completely different world in operation and it's the world that Marx calls original accumulation. How did it all began? It begins with a tale of violence and violent appropriation, a violent dissolution of a pre-existing mode of production and it's supplanting by a capitalist mode of production. Now in this story, in this section there is an interesting side commentary. I have circulated to you some passages from Hegel's 'Philosophy of Right'. Marx in one of his introductory notes to Capital, comments that he made his points on Hegel some twenty-odd years before, and what he's referring to there is lengthy piece he wrote called a 'Critique of Hegel's Philosophy of Right'. Now when you go and read Marx's critique there's something very interesting about it, that it ignores the first part of Hegel's discussion entirely and starts with a consideration of paragraph 250 onwards. What follows is a critique of Hegel's theory of the state
and civil society and the like. What Marx has totally ignored in that critique are the preceding few paragraphs which are, actually, very strange paragraphs within Hegel's 'Philosophy of Right' because suddenly when you get to this paragraph 243, Hegel suddenly launches into a very interesting discussion, in which he talks about "The amassing of wealth" on the one hand, which is being carried out through capitalistic forms of operation, which is coupled on the other
side with "the subdivision and restriction of particular jobs." This results in the dependence and distress of the class tied to work of that sort, and these again entail inability to feel and enjoy the broader freedoms and
especially the intellectual benefits of civil society." Then he goes on "When the standard of living of a large mass of people falls below a certain subsistence level – a level regulated automatically as the one necessary for a member of the society –
and when there is a consequent loss of the sense of right and wrong, of honesty and the self-respect which makes a man insist on maintaining himself by his own work and effort,
the result is the creation of a rabble of paupers. At the same time this brings with it, at the other end of the social scale, conditions which greatly facilitate the concentration of disproportionate wealth in a few hands." This is astonishingly similar to Marx's passage about accumulation of wealth at one pole and accumulation of misery, degradation and toil at the other pole. Hegel then goes on to suggest that there's no way in which you can actually redistribute income from the rich
to the poor to ameliorate this problem. Furthermore, if you go to one of the footnote on next page, footnote 149, he makes some remarks about poverty and the rabble and he talks about how many of them become dependent and idle. But ends with I think a very important idea: "Against nature man can claim no right, but once society is established, poverty immediately takes the form of a wrong done to one class by another." -i.e. class struggle- "The important question of how poverty is to be abolished is one of the most disturbing problems which agitate modern society." The problem of course is still with us, read Jeffrey Sachs and 'The End of Poverty', which again is one of those arguments in which the free market, Equality and Property
are going to be the major vehicles. But then Hegel suggests that there may be a solution, as he says, -this inner tension if you like the dialectic of class struggle
inside of capitalist society- This is on top of p.151, passage 246: "This inner dialectic of civil society thus drives it
– or at any rate drives a specific civil society – to push beyond its own limits and seek markets, and so its necessary means of subsistence, in other lands which are either deficient in the goods it has over-produced,
or else generally backward in industry" And then again the footnote: "Civil society is thus driven to found colonies." And the he talks about "Colonial independence proves to be of the greatest advantage to the mother country, just as the emancipation of slaves turns out to the greatest advantage of the owners." Now this I think explains something which otherwise seems somewhat peculiar about part eight, which is: why does it end with a discussion of colonization? When the penultimate chapter ends with the expropriators being expropriated,
the death knell of private property sounds and a revolution occurs, the kind of rhetoric that you would expect of the communist manifesto. Why suddenly is there this addendum? And I think it has a lot to do with Marx trying to not only square his accounts with Adam Smith, which he's going to do in part eight, but also to squares his accounts with Hegel and Hegel's account. In other words he feels some necessity to try to make clear that the colonial solution is no solution it will simply reproduce the social relations
of capitalism on a broader scale, particularly given the nature of colonial land policies as advocated by Wakefield. So we have to understand that Capital has always been written in the contexts of dialogues with these various people and of course the primary dialogue in part eight is Adam Smith's account of primitive or original accumulation, which was according to Adam Smith a peaceful affair (!) and it just happened that there were some people who were hardworking and some people who were not, some people who could be bothered some people who could not be bothered, and the result of this was (bit by bit) that those who were hard working
and who could be bothered accumulated some wealth, and eventually those who could not be bothered
could not accumulate wealth and in the end in order to survive,
actually preferred to give up their labor-power as a commodity in return for a living wage. So, as far as Adam Smith was
concerned, this was a peaceable process, it could almost be naturalized in terms of
human aspirations or the lack thereof and of course in all of this, it became very important in Adam Smith's account not to bring in the state as an agent of primitive accumulation. The reason being that Adam Smith's argument, like most of classical political economy, was trying to keep the state out of the story,
let there be laissez-faire, let the state withdraw. Let the state just act as a kind of night watchman of what's going on and then everything will be ok,
just let the market do its work. There were some areas, public investment and public health, where that didn't apply but overall this was the argument. So what Adam Smith and many of the other political-economists
tried to do is to naturalize the process of primitive accumulation. There were some political-economists who didn't do that. Marx mentions quite frequently the work of James Steuart. James Steuart recognized that there was a crucial role for the state in the formation of capital, and in fact there was a line of argument within classical
political economy which was subdued, which did indeed see a necessary violence which
would be visited by the state in order for original accumulation to occur. There was a book published, 2-3 years ago or maybe more, by Michael Perelman called 'The Invention Of Capitalism' and he does an extremely good job of going back
over all of the classical political economists and looking at them and saying 'what did they argue and what they did not argue?' and he focuses very strongly on James Steuart and he talks about the way in which Adam Smith spent a great deal of time evading and avoiding and in many instances voiding James Steuart's arguments in order to create this myth of original accumulation. Now, of course, for Marx this is a total myth, so his account is one of fraud, of predatory behaviors, of violence, illegality, and eventually the appropriation of state power. So what he says here immediately, is that "the methods of primitive accumulation are anything but idyllic. It is a notorious fact that conquest, enslavement, robbery, murder, in short, force, play the greatest part." Now here he's going to refer back to earlier passages in Capital. Back around page 273, Marx there is talking about the sale and purchase of labor power, and on page 273 he says this: "Why this free worker confronts him in the sphere of circulation
is a question which does not interest the owner of money, for he finds the labour-market in existence as a particular branch of the commodity-market. And for the present it interests us just as little. We confine ourselves to the fact theoretically, as he does practically. One thing, however, is clear: nature does not produce on the one hand owners of money or commodities, and on the other hand men possessing nothing but their own labour-power. This relation has no basis in natural history, nor does it have a social basis common to all periods of human history.
It is clearly the result of a past historical development,
of a past historical development, the product of many economic revolutions, of the extinction of a whole series of older formations of social production." What he's now doing is saying that we need to look at this process of historical development and it is this process that is being set up for examination in part eight. He similarly invoked earlier, prior forms of capital, usury and merchant's capital which he earlier described as anti-diluvian forms of capital. It is through the collision of those forms and the feudal system that we see the emergence of a true capitalist class. Because what we're seeing is the separation
of the workers from control over the means of production, as he says on the bottom of page 874: “The process which creates the capital-relation can be nothing other than the process which
divorces the worker from the ownership of the conditions of his own labour; it is a process which operates two transformations, whereby the social means of subsistence and production are turned into capital, and the immediate producers are turned into wage-labourers. So-called primitive accumulation, therefore,
is nothing else than the historical process of divorcing the producer from the means of production. It appears as 'primitive' because it forms a pre-history of capital and of the mode of production corresponding to capital.” Interesting point here, Marx seems, even though he uses the word 'appears', to be suggesting that primitive accumulation is part of the pre-history of capital. And once it is over, as he said on a previous page, once these two classes are configured then their relation is set then you don't need any more primitive accumulation. He says: This "historical movement…" on the one hand was an emancipatory movement, it was an emancipatory movement "from serfdom and from the fetters of the guilds, and it is this aspect of the movement which alone exists for our bourgeois historians." You emphasize the good side. "On the other hand, these newly freed men became sellers of themselves only after they had been robbed of all their own means of production, and all the guarantees of existence afforded by the old feudal arrangements. And this history, the history of their expropriation, is written in the annals
of mankind in letters of blood and fire." Most recent example of that would be the taking away of the 'iron rice bowl' in China, which guaranteed a certain standard of living for the mass of the population, and the creation of a wage-labour force, again a lot of it
through considerable violence in the countryside. So the history of primitive accumulation is this history of violent separation of a population from its means of production. But he does concede at the end of this chapter on page 876, that "The history of this expropriation assumes different aspects in different countries, and runs through its various phases in different orders of succession,
and at different historical epochs. Only in England, which we therefore take as our example, has it the classic form." Here too we should signal some questions. Why is England the classic form? What does it mean to say 'it could take different forms in different places
and different times? Is there a general process of primitive accumulation? Or are we dealing with a great deal of diversity of historical transformations? What he makes clear here is that he is going to use England, as the case which he is going to appeal to, as the exemplary case, in much the same way that he used the Manchester industry as the exemplary case for understanding the development of the factory system. Chapter 27 then takes up the expropriation of the agricultural population from the land. And there are two aspects to this, and here he does indeed quote Sir James Steuart on p.878, first off, you've got to dispossess the peasant population, but then the dissolution of the feudal system also released a whole mass of feudal retainers who had nowhere to go and who had lost, in a sense, their protections and their protected system/situation within house and castle. The feudal lords, he suggests, to degree they could do so not only got rid of their retainers, which turned them into wage-labourers, but also appropriated the common lands and set themselves up, in a way, as landed capitalists. Now at first, this is where I think Marx's story is particularly interesting, in the initial phases of this, this process occurred illegally through individual exploitation, expropriation, predation and violence. And so for the first 150 years after Henry the Seventh, there was an attempt by state law to control that process, to roll it back, but it didn't work, the lawlessness was too powerful. Then after the 16th century and the Reformation, as he says on p.881: "The process of forcible expropriation…received a new and terrible impulse… colossal spoliation of church property." And the formation again of a landed aristocracy that was concerned with commodity production. On p.883 he talks about how "After the restoration of the Stuarts, the landed proprietors carried out, by legal means…" That is: they got control of the state apparatus and they used the state apparatus to engage in enclosure of common lands and the usurpation of common property rights. And this was consolidated as he says on p.884 by what historians like to refer to as the Glorious Revolution "which brought into power, along with William of Orange,
the landed and capitalist profit-grubbers. They inaugurated the new era by practising on a colossal scale the thefts of state lands which had hitherto been managed more modestly. These estates were given away, sold at ridiculous prices,
or even annexed to private estates by direct seizure. All this happened without the slightest observance of legal etiquette.
The Crown lands thus fraudulently appropriated, together with the stolen Church estates, in so far as these were not lost again during the republican revolution, form the basis of the present princely domains of the English oligarchy." Then comes a consolidation of English bourgeois power over the state apparatus and the landed aristocracy, he says, moved into an alliance with the new bankocracy, "of newly hatched high finance, and of the large manufacturers,
at that time dependent on protective duties." So all of this meant that communal property disappeared, private property began to dominate and the state moved in behind that system. And the result -again interesting to think about- on p.886: "The 18th century, however, did not yet recognize as fully as the 19th the identity between the wealth of the
nation and the poverty of the people." I think this is a very useful thing to reflect upon. How many nations which have grown extremely wealthy in the last thirty years have done so as their populations have become increasingly impoverished? This then proceeds not only through the enclosure of the common lands,
but after the common lands are enclosed, you actually start to expel people from their villages. This is where you start to get elegiac poetry, Gray and Oliver Goldsmith etc. about the loss of the rural culture of Britain as a result of the expulsions and the destruction of village life. What Marx does is to prefer to use the famous example of the Duchess of Sutherland who on the one hand, as he says in the footnote on p.892, "entertained Mrs Beecher Stowe, authoress of Uncle Tom's Cabin, with great magnificence in London to show her sympathy for the Negro slaves of the American republic…" while expelling all of the crofters from the highlands in one of the huge highland clearances which cast people away from their traditional forms of livelihood and led them to emigrate, as many of them did, or end up as proletarians in the cities. So the summary of this argument is given at the end of this chapter on page 895, where he says: "The spoliation of the Church's property, the fraudulent alienation
of the state domains, the theft of the common lands, the usurpation of feudal and clan property and its transformation into modern private property under circumstances of ruthless terrorism, all these things were just so many idyllic methods of primitive accumulation. They conquered the field for capitalist agriculture, incorporated the soil into capital…" Interesting notion: the commodification of the land, the commodification of the soil, actually makes the soil a medium through which capital starts to circulate. "…and created for the urban industries the necessary supplies of free and rightless proletarians." In Chapter 28 we see what happens to these people when they get thrown off the land. What happens is they become vagabonds, they become paupers, in some cases they go into becoming highwaymen and robbers and all the rest of it. So what we here find is that the power of the state starts to be utilized as a disciplinary apparatus in relationship to those people who have been dispossessed of their livelihoods. And the story which Marx tells here is quite simply that state power is used, state powers of incarceration, of violent punishment etc. become actually standard practices. In fact you're saying to all the people who have been dispossessed that you either become good proletarians or else you're going to suffer from the disciplines of this state apparatus! Along with that, you have legislation over wages, so wages can't become too high, legislation on the minimum length of the working day, which we encountered earlier as opposed to the maximum length, and we get a whole series of barbarous laws against combinations of workers which accuse them of treasonous activity if they try to combine together to improve their lot. So the bloody legislation against the expropriated is a pretty awful tale, where you cut out people's tongues and do violent things of this sort just to simply demonstrate to people that they have to join the proletariat or else! This leads into a very short chapter on the genesis of the capitalist farmer, where we find that bailiffs and managers of farms became sharecroppers but then can start to use increases in productivity to make themselves independently wealthy. So whereas we had before a landed aristocracy that was interested in using the land for commercial purposes, particularly sheep rearing and wool etc., we now find, not a landed aristocracy anymore, but a class of farmers who are emerging out of this system as they pay rents to a landed aristocracy and at the same time manage to utilize their position on the land and their employment of wage-labour to accumulate wealth for themselves and start to become an independent wealthy class. Which then leads into Chapter 30. Because in Chapter 29 the necessary condition for
that to occur was rising productivity on the land. Rising productivity on the land meant less employment of labour on the land and increasing commodification of agricultural labor. In other words, whereas you may have had a lot of small peasant proprietors,
they have now been pushed off the land, even the small proprietors who paid rent to the landlord become bigger proprietors and smaller proprietors disappear. They start, because of the improvement in agricultural productivity, to release labor. So you get a landless agricultural proletariat. And the only way that landless agricultural proletariat can survive is by buying commodities, which increases the demand for commodities at the same time as it pushes this landless proletariat to seek employment as wage-labourer, either elsewhere in agriculture, or else in the towns within industry. So the commodification of rural relations becomes a critical moment in this transformation, and its the commodification of products, so that instead of the products being consumed by those who produced them, as in self subsistence agriculture, you find the products have been sent to market at same time as the demand comes from the market and the demanders are those who have to sell their labour-power in order to live. This creation of the home market is something which is, I think, worth noting. In the first part of Capital, you remember he suggested there is no problem in the market but here he is saying that the creation of the market is a crucial step. I think it's interesting right now that one of the major things that is being said to the Chinese, is that you should stimulate your home market and in many instances the politics of conquest of the home domestic market has become a very important part of political projects. So that this general argument that Marx is making about the significance of home market formation and the colonization of the home market, is something which we really need to pay very general attention to it. And it is this home market which is going to be crucial for the development of industrial capitalism, because without it, where would the capitalists sell their products to? You can't, as he has done in the earlier part of capital, assume there's no problem, you have to assume there's a big problem and here Marx is talking about the way in which it can be solved. Now, when we get to the industrial capitalist in Chapter 31, we're going to be talking in the first instance, of another form of revolution, which is not about small craft workshops becoming slightly bigger and the concentration of capital, it's going to be about the way in which usurers capital and merchant's capital become transformed, and as it were, become the vehicle for formation of the industrial capitalist. As he says on p.915: "The money capital formed by means of usury and commerce was prevented from turning into industrial capital by the feudal organization of the countryside and the guild organization of the towns. These fetters vanished with the dissolution of the feudal bands of retainers, and the expropriation and partial eviction of the rural population. The new manufactures were established at sea-ports, or at points in the countryside
which were beyond the control of the old municipalities and their guilds. Hence, in England, the bitter struggle of the corporate towns against
these new seed-beds of industry." This was a very interesting observation on Marx's part. The trade guilds were very powerful, many city corporations were governed by Burghers and by the guilds. And it was very difficult to break the power of the guilds. So cities like Bristol, Norwich and many others of that sort had very powerful institutions to maintain the status quo of political economic power, both on the part of the merchant capitalists but also on the part of the guild workers. So what did you do? What you find was the movement to what we now call 'greenfield sites'. You went to villages with names like Manchester, Birmingham, Bolton, Blackburn or Leeds and in these villages you started building factories. There was no way in which the guilds could control you, their control was strictly confined within the city jurisdiction. The merchant capitalist couldn't control you either and in very short order the merchant capitalists decided there was a great deal of business to be done, and were prepared to do business with the Manchester industrialists, the Birmingham industrialists,
the Leeds industrialists and the like. So the whole pattern of industrialization in Britain occurred outside of the leading city-centers and I think it's extremely interesting to look at the long history of capitalism in terms of this perpetual seeking out of greenfield sites where political and economic powers can be bypassed. What did the Japanese auto companies do when they came to the United States? Did they go to Detroit? What did they do when they went to Britain? Did they go to Birmingham? No, they set up on greenfield sites where labour organization was weak, where regulatory restrictions were relatively modest. So the whole history of capitalism has been about a perpetual move away from concentrations
of political and economic power which are inimical to a certain form of development, and looking for some place where you could actually do whatever you wanted to do. The deindustrialization of New York city began in the 1960s because union power was very strong here, in the first wave of deindustrialization it was simply a move to the suburbs. Get out of the city where there's too much political and economic control by labor. Go to the suburbs. Then you find one better, let's go to North Carolina instead, and you could go one further and say let's go to Alabama, let's go to American west. Go beyond that. Let's go the Makita zone of Mexico, let's go to China. So what Marx is talking about here is a very important process of geographical shifts which are fundamental to what bourgeois capitalism is about. And, of course, geographical shifts are at the heart of uneven geographical development. What follows is a more general discussion of how the industrial capitalist came to dominate so quickly and so fast. The first thing you notice is the role that the colonies play, as he says on p.915: "the colonies, the national debt, the modern tax system, and the system of protection. These matters depend in part on brute force, for instance the colonial system. But they all employ the power of the state, the concentrated and organized force of society, to hasten, as in a hothouse, the process of transformation of the feudal mode of production into the capitalist mode, and to shorten the transition. Force is the midwife of every old society which is pregnant with a new one. It is itself an economic power." And of course it is the state which can be the primary agent in utilization of that force. Now I would make an argument that far from the state being irrelevant in the rise of a neo-liberal order, as some people claim, the state has played a crucial role as the 'midwife' of history by using state force to try to absolutely ensure something akin to a neo-liberal utopian dream was going to be constructed via things like the national debt, the modern tax system and the like. Marx talks about the way in which state power got utilized. In the first instance state monopoly power through the East India Company, the way in which money was made from the opium trade, the way in which they created a famine in order to jack prices up so that they could profit immensely. Then we get these very important statements on p.918: "The colonial system ripened trade and navigation as in a hot-house. The colonies provided a market for the budding manufactures, and a vast increase in accumulation which was guaranteed by the mother country's monopoly of the market. The treasures captured outside Europe by undisguised looting,
enslavement and murder flowed back to the mother-country…" And then he talks about the way in which commercial supremacy produces industrial predominance in the period of manufacture and how the system of public credit, national debt and so on, played a very important role in all of this. As he says, you should take this on board: "with the rise of national debt-making, lack of faith in the national debt takes the place of the sin against the Holy Ghost, for which there is no forgiveness." You know the ticker tape board that takes note of the national debt, seen it down union square, total national debt, you see it going up like this .. like crazy its absolutely astonishing. And you've got to have faith in it, right? If you don't have faith in it .. if you get scared by it… wow. "The public debt becomes one of the most powerful levers of primitive accumulation." Furthermore, it gives rise to an emergence, as he says on p.920, of a "brood of bankocrats, financiers, rentiers, brokers, stock-jobbers…" "Along with the national debt there arose an international credit system…" -this is very prescient analysis- "One of its main lines of business, therefore, from 1701 to 1776, was the lending out
of enormous amounts of capital, on the part of Holland, especially to its great rival England. The same thing is going on today between England and the United States." So that transfers of capital, capital exports, capital movements and then the modern system of taxation, on p.921, and we see very clearly how that's been working today. Page 922, he summarizes it in the following way: "Colonial system, public debts, heavy taxes, protection, commercial wars, etc., these offshoots of the period of manufacture swell to gigantic proportions during the period of infancy of largescale industry. The birth of the latter is celebrated by a vast, Herod-like slaughter of the innocents." A Herod-like slaughter however which absorbs masses of otherwise redundant labor
into the factory system. And finding those laborers, as he points out on p.923, became part of the state organization. "the different parish workhouses of London, Birmingham, and elsewhere.," sent their surplus populations to the industrial districts. Furthermore, he points out that trade in labour didn't even stop with that. On p.924 he talks about the way in which "England acquired the right to supply Spanish South America until 1743 with 4,800 negroes a year." "this threw an official cloak over British smuggling.
Liverpool grew fat on the basis of the slave trade. This was its method of primitive accumulation." Which ends, much as the Hegelian argument comes back in, on p.925 where he talks of the 'eternal natural laws' of the capitalist mode of production. 'The eternal natural laws…' in inverted commas(!). "to complete the process of separation between the workers and the conditions of their labour,
to transform, at one pole, the social means of production and subsistence into capital, and at the opposite pole, the mass of the population into wage-labourers, into the free 'labouring poor', that artificial product of modern history." "If money 'comes into the world with a congenital bloodstain on one cheek', capital comes dripping from head to toe, from every pore, with blood and dirt." Which leads into Chapter 32, he summarizes his argument, and again I want to come back to this. Page 928: "At a certain stage of development, it brings into the world the material means of its own destruction. From that moment, new forces and new passions spring up in the bosom of society…" Again, Marx is always saying that you don't see radical breaks. You always see something emerging from within. but these "forces and passions which feel themselves to be fettered by that society. It has to be annihilated; it is annihilated. Its annihilation, the transformation of the individualized and scattered means of production into socially concentrated
means of production, the transformation, therefore, of the dwarf-like property of the many
into the giant property of the few, and the expropriation of the great mass of the people from the soil, from the means of subsistence and from the instruments of labour, this terrible and arduously accomplished expropriation of the mass
of the people forms the pre-history of capital. It comprises a whole series of forcible methods, and we have only passed in review those that have been epoch-making
as methods of the primitive accumulation of capital." "As soon as this metamorphosis has sufficiently decomposed the
old society throughout its depth and breadth, as soon as the workers have been turned into proletarians, and their means of
labour into capital, as soon as the capitalist mode of production stands on its own feet, the further socialization of labour and the further transformation of the soil
and other means of production into socially exploited and therefore communal means of production takes on a new form. What is now to be expropriated is not the self-employed worker,
but the capitalist who exploits a large number of workers." So now we come to the idea of the revolt of the working-classes! The recognition, as he says, "the entanglement of all peoples in the net of the world market, and, with this, the growth of the international character of the capitalist regime." "The centralization of the means of production and the socialization of labour reach a point at which they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated." The revolution occurs! What Marx does here is talk about the theory of colonization, actually it has very little to do with the actual processes of colonization in Australia, it really has to do with the ideas of Wakefield about colonization. Marx refrains from noting that Wakefield wrote his expositions on the colonial system in jail for having tried to kidnap the daughter of a very wealthy individual. What he was planning to do with her we don't know… but anyway he spent three or four years in jail,
and while he was in jail he decided to do something to amuse himself, so he wrote this book about colonization. What Marx is making of this is that Wakefield at least recognizes that if you have a colonial system where the immigrants are free to gain land for themselves and do whatever they want, than there is there's no labour for the capitalist. And so Marx enjoys the case of the capitalist who went there with all the capital and all of the stock and all of the seeds, but found he couldn't use it as he couldn't find any labor. So what Wakefield insisted was that colonial land policy should do two things. It should put a reserve price on land, i.e. make land scarce so there is a barrier to free occupancy of the land, and that secondly you would put restrictions on labour movement, on labour migration in such a way that there was always a surplus of labour available to you. And what Marx does is to recognize that in the United States there was a problem of this kind. That people were coming to the United States and given this free land on the frontier, they were disappearing. Okay, some residual groups were left in the cities but still there was a labour scarcity, a labour shortage and what you needed to take care of this was to do something different with the land. And, of course, what starts to happen with the granting of rights to railroads and all those kind of things is that you start to allow the monopolization of the land, commodification of the land and expropriation of the land by larger and larger groups in the population. So again in the United States, there is a fight as it were between free labor on the frontier and wage-labour in the cities and balance is there… and what Wakefield is going to talk about is that in places like Australia the colonial office should have a clear land policy. Which totally undermines the argument of Adam Smith about the peaceable way in which this would happen.
If Adam Smith was correct then what you would see happening in Australia would presumably be an Adam Smith story over again. But it doesn't happen that way, it doesn't happen at all that way. So what Marx is appreciative of is the fact that Wakefield at least understands what you need, in order to accumulate. As he says on page 932: "Wakefield discovered that, in the colonies, property in money, means of subsistence, machines and other means of production does not as yet stamp a man as a capitalist if the essential complement to these things is missing: the wage-labourer, the other man, who is compelled to sell himself of his own free will. He discovered that capital is not a thing, but a social relation between persons which is mediated through things." Sound familiar? This idea that capital is a social relation mediated through things
is fundamental to Marx's argument. He goes into Wakefield's argument and gives some examples and recognizes that state land policy, as I suggested, as he says on p.938, is "to kill two birds with one stone. Let the government set an artificial price on the virgin soil,
a price independent of the law of supply and demand, a price that compels the immigrant to work a long time for wages before he can earn enough money to buy land and turn himself into an independent farmer. The fund resulting from the sale of land at a price relatively prohibitory for the wage-labourers, this fund of money extorted from the wages of labour by a violation of the sacred law of supply and demand, is to be applied by the government, in proportion to its growth, to the importation of paupers from Europe into the colonies, so as to keep the wage-labour market full for the capitalists." "Under this plan, Wakefield exclaims triumphantly,
'the supply of labour must be constant and regular'…" The lesson, he says right at the end, is that "The only thing that interests us is the secret discovered in the New World by the political economy of the Old World, and loudly proclaimed by it: that the capitalist mode of production and accumulation,
and therefore capitalist private property as well, have for their fundamental condition the annihilation of that private property which rests on the labour of the individual himself;
in other words, the expropriation of the worker." In other words, John Locke has to be perverted, inverted into a system of expropriation and the Lockean vision supplemented by the Adam Smith story is not an adequate discussion of primitive accumulation. Now quite a lot of people since then have suggested that it's not part of the pre-history. It's an ongoing part of what capital accumulation is about. Rosa Luxemburg for example, here's what she has to say… If I can find my right glasses, …put my glasses somewhere…
This is what Rosa Luxemburg says, she suggests that capital accumulation, the history of capital accumulation has a dual character. "One concerns the commodity market and the place where surplus value is produced; the factory, the mine, the agricultural estate. Regarded in this light accumulation is a purely economic process
with its most important phase a transaction between the capitalist and the wage-labourer. Here, in form at any rate, peace, property and equality prevail and a keen dialectic scientific analysis of society were
required to reveal how the right of ownership changes in the course of accumulation into appropriation of other people's property, how commodity exchange turns into exploitation and equality becomes class rule." This of course is what Marx did in Volume One of Capital. "The other aspect of the accumulation of capital
concerns the relations between capitalism and the non-capitalist modes of production which start making their appearance on the international stage. It's predominant methods are colonial policy, an international loans system, a policy of spheres of interest and war.
Force, fraud, oppression, looting are openly displayed without any attempt at concealment and requires an effort to discover, within this tangle of political violence and contest of power, the stern laws of the economic process." In her view, there was an organic connection between these two forms of accumulation, and in her view the whole history of capitalism had to be read through the duality of the continuation of primitive accumulation alongside of this expanded reproduction process which Marx has outlined in volume one of Capital. Now she had some good theoretical reasons for making that argument. I won't go into them but you can find them out on your own; but nevertheless there are many people, including me, who would argue that primitive accumulation has never gone away and indeed it has taken on new forms and played a very significant role in the way in which capitalism functions. In Rosa Luxemburg's argument primitive accumulation
largely occurred at the periphery of capitalism. The sort of thing being done to India and China. It's the sort of thing being engaged in in the colonies but later on, when you get decolonization and
you start to get Neocolonialism and the like, you start to find completely different methods entering into the picture. You find the forcible extraction of resources, the violent appropriation of rights to the land, the violent dispossession of peasant populations. And if you go back and look at Marx's categories of primitive accumulation: the dispossession of peasant populations, when did that stop? Is it still going on? Isn't this actually what's been happening in Mexico and much of Latin America? Dispossession of rural populations in China, Hasn't this been going on pretty much everywhere? So that hasn't gone away. and when Marx talks about the international credit system and the public debt: have they disappeared? Or are they in fact major means for extraction of surpluses from all around the world? In other words, when you start to look at the bankocracy, the financiers,
all that predatory behavior, has that gone away? If it had gone away Wall Street would not exist. So in fact all of the mechanisms that Marx talks about in there, when you extract from this idea that it all went on back then and you projected into the present, you would say 'it's going on right now, all around us'. Money is being expropriated, rights are being taken away and we're not only talking about rights to land, we're talking about rights which have been very hard won through political struggle. I'll give you an example. United Airlines declares bankruptcy. In order to come out of bankruptcy it goes to the judges and says 'we can't honor our pensions or our healthcare programs'. The judge says 'fine' and suddenly people find themselves no longer
with assets which they thought they had. That is thievery, it is robbery,
it is legalized robbery sanctioned by the courts. Result is that when you go and hear interviews with United Airlines employees who thought they were going to retire on 80,000-90,000 dollars a year or something like that, suddenly find that the government insurance program only gives them 30,000 dollars a year.
So what do they have to do? They have to reproletarianise themselves at age 65 in order to live. This is what primitive accumulation is like and so I don't like the term 'primitive' because it makes it sound like it went on 'back there' so that's why I call it 'accumulation by dispossession'. And if you look at what's happened to family farms in this country, if you look at what's happened to pension rights, if you look at what's happened to healthcare rights, all of those things, in a sense it is 'accumulation by dispossession'. If you ask yourself the question: if a hedge-fund owner last year made 1,7 billion dollars in one year were the hell did that money come from? It came from somewhere it came from, I would argue, 'accumulation by dispossession'. People being thrown off the land. We see legal ways in which this is done. Eminent domain, for example, is being used to displace whole neighborhoods with boxed stores. This is a legalized form of 'accumulation by dispossession'. If we look at the despoliation of environments, the destruction of natural resources, this is again 'accumulation by dispossession'. In this case you are despoiling the global commons and what we see with global warming is just the despoliation of
the global commons through pollution and the like. All of this is going on now. In the history of what Marx is talking about is this period of the 16th and 17th centuries, there's some fabulous accounts of the class struggles that went on around then. The Levellers and
the Diggers and all those other elements of British society which were violently resisting 'accumulation by dispossession', though not yet in the wage-labour force, they were resisting the dispossession that was occurring to them. In fact, in the 17th and 18th century the primary forms of class struggle were anti-proletarianisation, were anti primitive accumulation or anti dispossession. And the same thing works today, a lot of global struggles are being waged against dispossession. This comes back to the question of which form of class struggle is going to be at the heart of any kind of revolutionary movement. I've made the argument in 'A Brief History of Neoliberalism' that capitalism since the 1970's, under Neoliberalism,
has not been very good at generating growth. Therefore the immense quantities of money which have accumulated in the upper classes, has almost certainly not come out of growth, a lot of it has come through 'accumulation by dispossession' . And I would argue that there's much more 'accumulation by dispossession' going on since the 1970's relative to what occurred in the 1950's and 1960's. Even though, what occurred in the 1950's and 1960's, it was there, no question. Particularly in terms of robbery of resources and environmental transformations. But what we've seen is a resurgence of mechanisms of 'accumulation by dispossession' in which the credit system, which Marx mentions here as a primary vehicle for this, the credit system has become the cutting edge for 'accumulation by dispossession.' What is going on in the sub-prime mortgage crisis? What we are seeing is people losing their homes. Who are losing their homes? Relatively poor people, the majority African-American or Hispanic, highly concentrated in certain zones of certain cities. This high concentration of foreclosures is a massive dispossession which is affecting, of course, the whole financial system and you might like to think 'at least some of the people on Wall Street are being hurt', but actually, I don't know if you've noticed
something, but all of those leaders of Merrill Lynch and Citibank and so on, that have been forced to step down, they've kept every penny of the remuneration they had during all those years when they were backing this mortgage and sub-prime mortgage bonanza. Not only that as they step down they get a golden handshake of a hundred million dollars whereas the poor person in Cleveland who loses their home gets nothing. This is the dynamics of 'accumulation by dispossession' and part of my argument would be that the political struggles against 'accumulation by dispossession' are just as important as the traditional proletarian movements have been. But the traditional proletarian movements, and the unions and the political parties which have sprung out of that, have not been very cognizant of, or even concerned with, 'accumulation by dispossession'. So when you hear about the World Social Forum,
when you go to any of the World Social Forums, what you're likely to hear is a lot of talk about 'accumulation by dispossession' and quite a lot of antagonism towards traditional union forms of organization. So that you'll find in Brazil, for example, an organization which is against dispossession, the Brazilian Landless Peasants Movement is not necessarily in alliance with the PT, the workers party, which has more of a traditional urban proletarian base. And part of my argument would be is that if Rosa Luxemburg
is right and there is an organic relation between these two forms of accumulation and if the history of capitalism is about these two
forms of accumulation working together then we have to look at our contemporary era in that way but we also have to construct the idea of an oppositional force. If you like, an oppositional force of the dispossessed, workers who are dispossessed of surplus capital in the labor process, and people who have been dispossessed of their assets and rights through 'accumulation by dispossession' elsewhere. And I think the idea that comes out of Marx that primitive accumulation is something in the prehistory is erroneous and has to be modified into a different configuration if we are to come up with any kind of politics of the current moment. But then I would argue, that this was true even back then. And Mao recognized that when you start to talk about peasant/worker alliances, Gramsci recognized that, when he started to talk about a northern block alliance with a southern block alliance. In other words there is a history within Marxism
of taking these kinds of ideas seriously, and I would want to push them even further than they have been taken historically, because I think this is a terribly important conjuncture. To get the idea of who the dispossessed are and what political possibilities come out of their mobilization is crucial for finding ways out of the current impasse as to what capitalism is about. With that we've come to the end of our reading of Capital!
So next time, what I want you to do is to read the first chapter again and think about what Marx is doing there. See how well you understand it, and in particular to think about fetishism. And think of the number of times in which the idea of fetishism, that is 'it seems this way but it's actually another', how many times does that crop up throughout this text? I think what you will find is that it occurs again and again and again, and you will start to see that as you go through. So do a revision and at the same time speculate a little bit about where this analysis is going to help us understand the political economy of capitalism more generally and actually help us predict a little bit where Marx is going to go in volumes two and three because, as I suggested, Volume One is a foundation for volumes two and three and it doesn't cover
everything in volumes two and three but it certainly highlights some of the problems which need to be taken up in volumes two and three. So we'll talk about that next time.
