Capital against Capitalism

Historical Materialism Conference

Sydney



The productive and coercive character of workfare


Marcus Banks





Abstract

Marx defines capital by what it is and how it acts. Capital is an accumulation of
surplus-value produced by labour (taking various forms) and acts to secure further
accumulation the self-expansion of value. Integral to the dynamics of
contemporary accumulation, the state, through in its relative political autonomy,
intervenes as a collective capitalist to secure sufficient labour power is available to
be drawn into this dynamic.

A misunderstanding of the national state-capital relation leads to one-sided critiques
of workfare (and social policy generally) by many Marxists. Stress tends to be
placed on the political or ideological character of these state interventions.
Workfares economic character is usually left floating in the realms of more general
abstractions, poorly connecting the relationship of workfares production to its
coercive aspects. In outlining this specific aspect of the state-capital relation through
a case example, one argument is made that to further develop a Marxist critique of
social policy is an essential part of Marxisms political project.


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Jim Kincaids (2007:158) observation that Marxist value theory is still very much a
site under construction is especially apt for social policy analyses. The recent
debate in journals such as Historical Materialism about how value is to be theorised
has so far tended to sideline the state in the capital relation {Fine, 2008 #2140;Fine,
2008 #2360;Kincaid, 2007 #1891;Carchedi, 2009 #2332;Fine, 2009 #2362;Kincaid, 2009
#2361}. Greater space opens for Marxist state theorists such as David Harvey and
Ellen Meiksins Wood to wrongly hold that state economic activities lie outside
capitalist production relations {Harvey, 2003 #1344: 141}, a detachment due to the
disconnection between the economic and political moments of capital {Wood, 2005
#2329: 25}. The Poulantzian-derived approach by leading welfare state theorists
such as Bob Jessop operates within a similar dichotomizing assumption. Jessop
only tests the economic character of state welfare interventions (in a location beyond
market mechanisms) to either commodify or decommodify latent labour-power
against its exchange-value moment in the labour market. Only an abstract political
struggle between capital and labour frames which action the state takes success
by the former supports.. a market-mediated self-valorization of capital whereas
triumph by the latter weaken[s] the logic of capital accumulation {Jessop, 2002
#350: 14-19}.

Apprehending the state simply as a superstructural entity precludes any conceptual
capacity to discern the movement of value in welfare policy. The question of locating
the nation state in the capital relation without reducing it to the capital relation was
initially elaborated by Hilferding, Bukharin, Lenin, Luxemburg and Grossman in the
early 20
th
Century. Bukharin, for instance, argued that states had become
economically part of the concentration and centralisation of capital and that
international competition between state capitalist trusts was emerging as
imperialism. As a result, economics is organisationally fused with politics in a way
not envisioned by Marx {Bukharin, 1971 #2125: 36}. The political and economic
tensions of welfare policy are a mediated expression of a states social reproduction
and accumulation relations with capital and the working class.

The question of whether state welfare interventions (and the labour employed to
produce workfare and other social programs) are productive of capital becomes
more acute as the economic weight of the state increases in its relation with capital
(OECD 2009: 77-79) and welfare costs in Australia continue a 40-year rise as a
proportion of government expenditures (Laurie &McDonald 2008: 36). Debates
about the productive character of state-employed human services labour often
remain stuck in one-sidedly applying a dialectical method which deduces this labour
to be unproductive {Laibman, 1999 #2183;Mohun, 2002 #2363;Savran, 1999
#1892;Izquierdo, 2006 #1567} or concludes that the distinction is meaningless {Laibman,
1999 #2183}.

Marx initially drew on Adam Smiths distinction between productive and
unproductive labour for early capitalist development, to consider (from a politically
oppositional pole to Smith) what was productive in capitalist terms. Marx argued
that labour which created surplus value was productive since such labour enabled
capitalists to accumulate. Because the difference between productive and
unproductive labour had nothing to dowith the particular use value in
which...[it]is incorporated, all surplus-generating labour was considered productive
regardless of whether material commodities or services were being produced {Marx,
1971 #1893}. According to Dussel (2001: 69), Marx initially assumed that the
performance of unproductive labours with only minor exceptions were broadly
clustered around the personal services provided to the establishing ruling class.
Included in this model was state labour. From the perspective of industrial
capitalists, the costs of those employed to mediate the conflict between private
interests and national interests was regarded as necessary incidental expenses for
their pursuit of accumulation (Marx 2000: 7).

When considering the more concrete dynamics of many capitals in the third volume
of Capital, Marx revisited this distinction to examine the development of other forms
of unproductive labour as the scale of production is extended {Marx, 1981 #967:
413}. The labour of maintaining discipline inside the workplace by managers and
supervisors, the chain of commercial labour processes bringing previously produced
commodities to the market, and the financial labour involved in the production and
circulation of capital were generally considered to be unproductive. Confronting
Marx was that his earlier distinction dealing with an individual capitalist (as a
simplified abstraction of capital in general) would require defining such labour to be
productive if one capitalist purchased these services from another since surplus
value is deemed to be created. From a volume 3 historical perspective of capitalism
as a competitive totality, however, these labours remain unproductive as no new
surplus value is produced at a systemic level {Freeman, 1981 #2184`, 88}.

In Capital, as Marx methodologically develops his argument towards competition
between many capitals, the new distinction he makes between productive and
unproductive labour remains dialectically connected to its earlier and simpler
determination of what advances/retards accumulation. Marxs continues to situate
his distinction within the larger theory of the capitalist mode. He adds more concrete
content to that theory by analysing capitalist production relations as they are
becoming pervasive and as the dynamics of accumulation centre on extracting
relative surplus value from labour-power. Marxs strategic repositioning of his earlier
abstraction allows him to argue that because the profits of commercial capitalists
came from operations within capitalist production relations, and so within already
created surplus value, the labour they employed was not productive since no overall
furthering of accumulation occurs. While the outlays of capital circulation costs
appearas a productive investment to the commercial capitalist, and the labour
commercial capital exploits appears as immediately productive {Marx, 1981 #967:
296}, they are classed as unproductive expenses so far as society is concerned
{Marx, 1978 #1328: 137}. This later distinction between productive and unproductive
labour Marx adopts of what labour adds to the surplus value available to capitalism
(as competition between capitals to accumulate and a struggle between capitals and
the working class), provides a basis to develop his theories of exploitation and the
tendency of the falling rate of profit.

Marx stresses the two-fold nature of the process of production. Capitalist production
relations involve a social process for producing use-values and a process for
creating surplus value, of labourers performing abstract labour creating a
commoditys value. Prior to a commoditys value being realised as exchange-value,
abstract labour (the substance of value) is contained in the commodity as it is being
produced by the collective labourer for the capitalist who, under developed
capitalism, is the appropriator of surplus value extracted by a complex bureaucracy
of many individuals each performing a different aspect of the work of exploitation
(Carchedi 2009: 156). Due to the real subsumption of labour under capital into the
overall labour process an ever increasing number of types of labour are combined
and included in the immediate concept of productive workers {Marx, 1976 #924:
1041}. Under Marxs distinction those involved in aiding the realisation or
maintenance of the value of a commodity while not directly producing it, such as
transport and storage workers, perform productive labour. Some retail labour work,
for example, is considered productive (such as shelf stackers) and others
unproductive (cash register operators are necessary only because the products take
a commodity form). Supervisory labour is productive in its co-ordination role within
the labour-process and unproductive when such labour merely arises from the
antagonistic contradiction between capital and labour {Marx, 1863 #2185}.

The complexity of Marxs method of rising from the abstract to the concrete therefore
takes more than the form of a deductive {Smith, 2003 #1373} or conceptual {Arthur,
2002 #1371} derivation as claimed by those promoting a new or systematic
dialectic. However, what remains problematic is Marxs lack of integrating the
economic role of the state into his theory of the dynamics of capitalism. The scale of
unproductive labour has grown dramatically in sections of finance, commerce and
manufacturing capitals and in non-productive state functions such as the military and
the legal system {Moseley, 1997 #1669;Shaikh, 1994 #1568;Mohun, 2003 #1553;Harman,
2009 #2123;Cliff, 1974 #1308;Kidron, 1974 #1323}. A capacity to thematise the
distinction between productive and unproductive state labour into three levels of
generality (the systemic, local and individual economic relations of state labour to
capital) comes from the few authors who also inductively discern capitals modern
dialectic in the state (Carchedi 2009; Freeman 1996: 231; Harman 2009). Under
modern capitalism, Marxs model, based on competition for markets through the
accumulation of productive investments seeking to reduce processing costs and
commodity selling prices, becomes one dimension of competition {Harman, 2003
#928: 45}. The dynamic creating the collective labourer becomes an economic and
historical dialectic in unity with its opposite the state as a collective capitalist which
politically facilitates or militarily leverages international sources and sites of
accumulation for its local capitals. A relation develops where a states international
interventions, like the competition for surplus value Marx talked about for commercial
capitals, are productive for local capitals while unproductive at a systemic level.
Similarly, in its internal economic and relatively autonomous political interventions, a
states revenues may appear as unproductive expenses of production for an
individual capitalist but may be essentially productive for national capitals
collectively. The contemporary character of state labour can therefore be thematised
as:

Systemically and locally unproductive labour of disciplining the
workforce and ideologically promoting a nations productive ethos such as the
health, education and welfare labour of sustaining the relations of exploitation
in the supply, training, maintaining and reproducing of labour power;
Systemically unproductive and locally productive labour such as military
labour which pulverise values at a systemic level but may leverage foreign
sources and sites of accumulation for some local capitals (Grossmann 1992:
157); and
Systemically and locally productive labour which furthers capital
accumulation by producing research, or labour power supply, training,
maintenance and reproduction policies.


Investigating workfare as an unproductive intervention (an immediately coercive
program for participants and a general disciplinary reinforcement for the employed)
and as productive of capital focuses analytical attention on the contradictions of this
relation. Welfare becomes an economic aspect of the social relations of production
a class-ridden industry with its own dynamics. A clearer understanding emerges of how
Australian welfare policy is produced within the contradictions of the state-capital
relation to investigate, for example, the competitive pressures driving state-funded
not-for-profit agencies to call for industry-tailored capital markets to fund an
expansion of their activities (NAB, 2011). At the level of national capital in general,
state and state-funded workfare labourers are modern equivalents of Marxs storage and
transport workers productively maintaining the value of a social security recipients labour
power from various social degradations and adding to its value through an educational or
training conveying process prior to its market realisation. State managers produce strategies
to legitimately minimise the state-as-capitals internal production costs, (re)produce
internationally competitive variable capital in the form of welfare-readied labour-power and
place further political pressure on dampening class expectations for state outlays on
unproductive welfare expenses. The dramatic feminisation of the Centrelink frontline
workforce in the late 1990s can be materially linked to the emotional and affective
labour required to more productively institute the Howard governments welfare reform
agenda.

Yet to boost Australian maternal employment rates to internationally competitive levels
of exploitation has required family-related expenditures to rise, even though they are
highly geared outlays which boosted accumulation. A departmental study estimated
that in 2001- 02, each dollar outlaid by the government for formal child care
leveraged $8.11 of economic benefits of which $1.86 was returned directly to the
Governments bottom line, in the form of increased taxation and reduced government
outlays {Martin, 2004 #1120`, 9}. Various fractions of capital are directly advantaged
as new labour became available at a subsidised rate, and most indirectly reap the
benefit that these increased social payments help exert a general downward
pressure on wages, especially in the low-skill end of the market {Productivity
Commission, 2002 #1381`, 26}

Apprehending the economic and political contradictions of welfare materially
uncovers how the ideological character workfare is not simply legitimated by the political
machinations of the ruling class but becomes personified and endowed with consciousness
and a will through the fetishising practices of producing the program {Marx, 1976 #924: 254}.
Conversely, and most optimistically, the potential to resist workfare does not simply reside
outside the state in the broader working class but from class conflicts within the heart of these
agencies.