Capitalism and the State

In Feudalism, the landlord charged a rent/tax from the peasants in exchange of protecting them and giving them access to his land. You could rationalise this and say "Well the landlord is protecting the peasants, so it's a fair exchange." But ask yourself this, who is the landlord protecting peasants from? Well, from the other landlords he is constantly at war with...  Oh-oh, something seems rather fishy about Feudalism. It's like it's based on a type of circular logic, that the existence of the Feudal class system is what "justifies" the role of the Feudal classes (and hence their existence). The only thing that justifies Feudalism is Feudalism itself, it exists for it's own sake not for some bigger reason or due to eternal or "natural" laws of society; and the roles people play inside Feudalism are historically specific to that mode of production and subjected to change when relations of production change. The same is true for Capitalism.

Workers rely on Capitalists hiring them and advancing accumulated surplus as wages. Why do they? Because they lack means of production to employ themselves and surplus to sustain themselves. Why? Because Capitalists own the vast majority of the means of production. If access to means of production and relations of production changed, the role of Capitalist would be unnecessary, redundant. It is a historically specific phenomenon, not the result of eternal laws of economics, and trying to justifies it by saying "the Capitalist deserves X or Y" is missing the point.

It is very easy to rationalise the monopoly of the social surplus under any type of class society: If you tried to argue that the Capitalist plays an important role advancing Capital (and argue he "deserves" part of the surplus), you would be right! The Capitalist is definitely very important... but only for the Capitalist mode of production, much like the Feudal Baron played an important role in the Feudal mode of production - those respective modes of production wouldn't even exist if it weren't for people playing the role of Capitalist and Noble.

The function of Capitalist means advancing money and gaining back more money at the end of the day: Advancing money to buy means of production and labor-power, let labour power use the means of production to make commodities, sell commodities for more money. The process of exchange does not create or add any new value by itself (new value or an aggregate rise in prices can only come from producing new things, all pure exchange can do is shuffle existing value around), and neither can the means of production act as the source of surplus (they can not 'add' more than what they cost to buy as they are 'dead-labour' or 'stored-labour' that left alone produce nothing, in the end all production reduces itself to labour. So the only possible source of surplus from this exchange must be the work of the labourers: The price of labour-power is lower than the value produced by said labour-power, and hence the 'value added' to capital by the worker. In the aggregate labour-power is the only commodity that can "add" more than what is costs to buy.

 A capitalist doesn't need to "allocate labour and resources", he can hire managers and market analysts for that (and management, depending on the function, is productive labour). The function of Capitalist is the act of advancing money and obtaining more money. The most easily observable example of Capitalism is stocks and share-trading: Shares in a company can change hands multiple times a day on the stock exchange without the share-owners ever coming into contact with production, its decision making or resource allocation; and the factory keeps producing just the same. This is because investors are attempting to get money out of advancing money, exchanging money for more money - being capitalists.
A capitalist, for sure,  can do many things other than being a capitalist. He can be a manager and CEO, an inventor and innovator, or do absolutely nothing like a rentier or an heir to riches. But the function of a Capitalist, the function that is the source of most of his income as a capitalist, by itself produces or adds no new value to production - yet still gets a surplus. This surplus can only come from unpaid-labour. This carries several implications (that capitalists work to get as much out of workers as possible, that the rate of wages is not about 'marginal productivity' but about market power, that a reserve army of labour benefits the capitalist economy by depressing wages, etc).

 If workers do not have means of production (the ability to employ themselves) and also are not employed by a Capitalists, they would starve. Marx argues that, since the only choice workers have is to sell their labour-power in the market, Capitalists can buy this labour-power for less than the value the labour produces, and the difference between these two amounts is the surplus accumulated.

So the real question is: Why do workers not have the ability to employ themselves? Because the vast majority of the means of production are owned by a minority. How did that situation come about? Marx argues this situation came about and is maintained due to an enormous act of violence: During the last days of Feudalism, the Mercantile State did everything in it's power to dispossess the small producers and peasants. The Enclosures of common land, the establishment of artificial prices on un-settled land, banning hunting on forests, slavery, mercantilist monopolies and tariffs - all of this was part of a process that took the means of production from the many and put them in the hands of a minority. The "voluntary exchange" happens in a very involuntary context, workers and capitalists are not equal parties exchanging the commodity "labour-power" for the commodity "Capital"; it is an exchange between vastly unequal parties (one is completely reliant on the other) .

You must work for a living whether you want to or not, whether that's on land that you're farming or as part of a business organisation. The real question is: How do we work, in what conditions do we work, who gets to control the product of the work and what do they do with it? The answers to those questions give us the mode of production we live under. If we live in a class society, we have to work in a class society and our work must be understood in class terms. The fact we have to work is not the question, the fact we need to work in a class society is.

 One thing that can't be taken from workers is their labour-power. However, without access to viable means of production, labour-power is nothing. "It doesn't matter if you use it to till land or work a factory", but without the land or the factory, what are you going to do? Just look at the very existence of unemployment.

 After Capitalist relations of production were established, the bourgeois State must act as a monopoly on force and a defender of the Capitalist-type of private property, using continual coercion to maintain the system. Marx argues that no type of class society would stand without a State. Who would enforce Capitalist forms of private property and contracts and break up workers on strike if not a State? What would prevent workers from just seizing the means of production? It is on a similar line that Anarchists argue that Capitalist private property and relations of production are unenforceable in the absence of the State. The State isn't an "overarching" institution but part of the superstructure of Capitalism. If the most basic Capitalist social relations imply a conflict of interest, this will remain true regardless of the amount of government intervention in the economy.

The Marxist concept concerning the state is well-known. The state, as an historical category, is the tool of one class for suppressing other classes of society. If the state is a relation between men, then insofar as it oppresses, represses or dictates it does so in behalf of some men at the expense of others. Those who oppress and those who are oppressed represent a social division upon which the state is founded. This class division, this social antagonism as the source of the state power is the only scientific conception of the state.The core of state power is always the apparatus of violence: the police, the army and the courts of justice. The Marxist will always make use of and fight for democratic rights and liberties, but never believing that such demands may be obtained other than partially and incompletely under capitalist conditions. The socialist never attempt to hide that any success in such struggles under capitalist conditions, will only be partial and of limited permanence. Lasting and significant social progress will be part and parcel of an entirely economic system - socialism.

 The nature of the state is determined by its relation to the economic structure and the economic classes of society. The capitalist apologist  recognizes this fact by implication when he gives his own grounds for believing that the state is “impartial.” No sooner does the government, through a tax bill, legal decision, strike mediation or some other action yield to necessity, to class pressure, and deprive the capitalist class of 1% of its profits, than the pro-capitalist shouts: “You see, here is an anti-capitalist government.” He neglects to notice at the same time that the government has guaranteed, ensured, the other 99% of capitalist profits and the economic system which makes them possible. The superficial issues which so captivates the attention of the easily diverted media does not embrace the essence of the state power. Even if the working class were to win their battles on all these issues (which never happens), the government remains capitalist because the whole essential substratum of action and policy, which occupies the attention of the state 365 days of the year, is designed to uphold and administer the capitalist system.

The fact that the capitalist class or individual capitalists cannot get everything they want from the capitalist state does not at all impress. They can’t because circumstances make it impossible, not because the state power is against them. This is particularly true in the present period, when corporations must surrender a large portion of their profit to the war machine in order to safeguard the rest of it.  Some thoughtless and irresponsible (from their own viewpoint) critics on the libertarian right such as Ron and Rand Paul try to make political capital and anti-establishment platform of this, but they have been rejected by the overwhelming majority of the capitalist class in both the Republican and Democratic parties. For the rest, the capitalist class as a whole keeps up a running fire against high taxes, not because it could or would alter the tax structure fundamentally, but in order to keep its share as low as possible within the limits dictated by present circumstances.

The basis of the Koch brothers philosophy is that the existence of private ownership of the means of production makes it possible for the people to control the government because there are sources of power for them to lean on outside the government. If however private economic power is abolished, then there is a danger that when no power remains outside the government, government itself will rest on power. The “will of the people” could not prevail against the new pressures of government since only one power structure remains therefore the people are now disarmed. Here is the libertarian capitalist argument reduced to its bare bones: We need the capitalists and their power to rest upon in opposition to government.

 Historical research into the French, American, English, Dutch and other capitalist revolutions has demonstrated that the masses of the people (the professional and intellectuals, shopkeepers, workers, etc.) had to wrest these liberties from an unwilling capitalist class. Research find the power of the private propertied class to be a barrier in their way in all their efforts to control the government. Despite their vehemence against Marx, Middle America have to accept his law of capitalist development: that capital grows out of commodity production and that big capital grows out of little capital and that monopoly capital grows out of big capital, and that this process cannot be reversed by protests and lamentations so long as capitalism continues. We see the ridiculous spectacle of small-town conservatives  appealing to the Koch brothers and the Pauls, in all seriousness, that these are just the boys who will do the job!

In no country, after generations of capitalist rule, has democracy been carried to the full. In this country we have a hereditary chamber, a hereditary monarchy, and an irremovable judiciary, appointed by the elite from among the elite, to interpret and to enforce the laws, the whole forming a system of frustrating the people’s will which acted in a most effective manner. It is a system of “checks and balances” which reduces the rights of the population. Bourgeois democracy at its optimum is a restricted and partial form which serves as vehicle for the overlordship of the tiny portion of the population that owns the means of production.

In America there exists a president with near royal prerogative powers, and the administration, centralised in a way which only an autocracy could rival, invested with a plenitude of powers the Supreme Court is the supreme sanctifier of the laws. The “sovereignty” lies in the dropping of a piece of paper into a box every four or five or seven years. Democracy has been and still is to-day a  sham. Under its cover we had all along nothing else than the dictatorship of the capitalist class. Marx used the phrase “democratic swindle” whereby he meant it was a swindle not insofar as it was democratic but, on the contrary, insofar as it utilized democratic forms to frustrate genuine democratic control from below. Marx was referring to a country which had one of the most democratic  constitutional forms of the time: the United States. It was, indeed, “the model country of the democratic swindle” not because it was less democratic than others but for precisely the opposite reason. The fact that the US had developed the formal structure of the constitutional republic in the most democratic forms meant that its bourgeoisie likewise had to develop to its highest point the art of keeping the expression of popular opinion within channels satisfactory to its class interests. There has been a plethora of clever electoral systems devised to insert a manipulative factor into the forms of a more or less universal suffrage, beginning with the American Constitution. Engels would write  that “England is undoubtedly the freest, that is, the least unfree country in the world, North America not excepted”,  that the methods and forms of the political system are designed toward “making concessions merely in order to preserve this derelict structure as long as possible”. He goes on, “The Englishman is not free because of the law, but despite the law, if he can be considered free at all” , for it is the constant threat from below that ensures the recognition of democratic rights in practice. Engels concludes “But mere democracy is unable to remedy social evils. Democratic equality is a chimera, the struggle of the poor against the rich cannot be fought out on the ground of democracy or politics in general. Hence this stage too is only a transition, the last purely political measure that still is to be tried and from which a new element must immediately develop, a principle transcending everything political.This principle is the principle of socialism.”

What is democracy? It is the rule of the people, by the people, and for the people. It is our battle-cry in the class war. The Socialist Party has been sincere advocates and champions of democracy. The working class has succeeded in obtaining possession of political power. What is called bourgeois democracy, was never regarded by us as anything more than a means to an end. The fight for democratic forms of administration is part of the socialist effort; not its be-all and end-all but an integral part of it all. The issue has always been what will maximise the influence of the  workers movement on the political forces. Social democracy is not merely the replacement of the authority of bourgeois rulers with the authority of a socialist central committee but rooting out old habits of obedience and servility.  It is the use of all the means of political power to  expropriate the capitalist class – in the interests and through the will of the revolutionary majority, that is, in the spirit of socialist democracy. Without the conscious will and action of the majority of workers, there can be no socialism.