Labor Theory for (Marxist) Dummies: Part 4

by Jehu

Is a fully developed communist society possible right now?

047I want to illustrate my point from the last post that to bring the labor reserve into production and so reduce hours to a minimum for everyone in society requires a much larger reduction than may be generally assumed in the literature on the subject. To do this, I will be using actual data drawn on the United States. As I will show, under present conditions in the United States the reduction of hours of labor now required to absorb the labor reserve into production may be so large as to effectively bring us to the threshold of a fully developed communist society.

Keynes prediction of a fifteen hours working week

To begin, let me borrow a quote from Keynes in 1930 that will, no doubt, be familiar to you regarding the technical progress of material production:

“From the sixteenth century, with a cumulative crescendo after the eighteenth, the great age of science and technical inventions began, which since the beginning of the nineteenth century has been in full flood—coal, steam, electricity, petrol, steel, rubber, cotton, the chemical industries, automatic machinery and the methods of mass production, wireless, printing, Newton, Darwin, and Einstein, and thousands of other things and men too famous and familiar to catalogue.

What is the result? In spite of an enormous growth in the population of the world, which it has been necessary to equip with houses and machines, the average standard of life in Europe and the United States has been raised, I think, about fourfold. The growth of capital has been on a scale which is far beyond a hundredfold of what any previous age had known. And from now on we need not expect so great an increase of population.

If capital increases, say, 2 per cent per annum, the capital equipment of the world will have increased by a half in twenty years, and seven and a half times in a hundred years. Think of this in terms of material things—houses, transport, and the like.”

In a later passage, Keynes extrapolates his technical argument to arrive at a conclusion that has been often cited by many writers today: “The economic problem may be solved, or be at least within sight of solution, within a hundred years.” The labor time technically required of each of us to produce all we need may be as little as fifteen hours per week.

Of course, Keynes argument above, as prescient as it was technically, ignores that the capitalist mode of production is production for profit. He therefore ignored the fact that, no matter the technical progress of material production, the production of surplus value remains the over-riding concern of capital. And this ideological prejudice has proven to be a fatal flaw in his argument as it was for so many political-economists before Marx.

While technically we may get by with fewer hours of labor, capital requires ever increasing quantities of living labor, since living labor is the only source of value and surplus value.

Moishe Postone uncovers the fatal flaw in Keynes’ prediction

The conclusion by labor theory that living labor is the only source of surplus value has consequences because it implies that, with the technical improvement of the productivity of labor, the labor time of the working class will not decrease but, instead, will become increasingly superfluous to the production of material wealth. Thus, instead reducing the labor time of the working class, the capitalist mode of production gives rise to a new peculiar category: superfluous labor time.

As Moishe Postone explains, in his book, Time, Labor and Social Domination, the capitalistic requirement for ever larger quantities of living labor in the production of surplus value leads paradoxically to a growing mass of labor time that produces nothing:

“Until this historical stage of capitalism, according to Marx’s analysis, socially necessary labor time in its two determinations defined and filled the time of the laboring masses, allowing nonlabor time for the few. With advanced industrial capitalist production, the productive potential developed becomes so enormous that a new historical category of “extra” time for the many emerges, allowing for a drastic reduction in both aspects of socially necessary labor time, and a transformation of the structure of labor and the relation of work to other aspects of social life. But this extra time emerges only as potential: as structured by the dialectic of transformation and reconstitution, it exists in the form of “superfluous” labor time. The term reflects the contradiction: as determined by the old relations of production it remains labor time; as judged in terms of the potential of the new forces of production it is, in its old determination, superfluous.”

Postone’s argument is very simple: although, as Keynes stated, capital brings into existence all the technical means to abolish labor, capital itself cannot realize this abolition, because labor is the sole source of surplus value for capital. Rather than abolishing labor, capital progressively renders labor superfluous to the production of material wealth.

However, although labor theory suggests Keynes’ technical argument was fatally flawed, because it ignored the fundamental logic of the capitalist mode of production, calculating how much of the present working day is actually wasted, superfluous labor time runs into a practical problem of its own.

Calculating superfluous labor time in ‘the economy’

That problem can be stated this way: Even assuming there is a huge mass of superfluous labor time in the economy, we have no way of directly identifying it. Since we cannot identify which labors produce value, it would seem almost impossible to calculate how far the work week must be reduced to draw the reserve army of labor into production in order to reduce the labor time of all to some necessary minimum.

Once labor power becomes a commodity, the producer no longer sells her product directly. Instead, she sells her labor power to the capitalist, who then puts it to work creating surplus value. Generally speaking, we assume the employment of the labor power by the capitalist is productive, but if Postone’s reading of labor theory is correct, this is not necessarily the case and it becomes increasingly less likely as the forces of production develop.

To give an example: The worker in a steel factory and a worker in a defense plant both sell their labor power, but only one is productively set to work by the capitalist for production of surplus value, while the other simply consumes the surplus value that has already been produced. However, things are not always so cut and dried: To further complicate the problem of identifying superfluous labor in the economy, the productively employed worker at the steel factory may produce a commodity that enters into the product of the unproductively employed worker in the defense plant. Did the labor expended on the production of the steel industry input for the defense industry product create value?

If we cannot answer this question, how do we determine how much unnecessary labor is today being expended that could otherwise be reduced to free the working class from wage labor?

I want to make a suggestion at this point: insofar as exchange value requires the exchange of one commodity for another, we can use the state sector as a proxy for non-value producing labor in the economy. I will admit that, as a proxy, the state sector only approximates the total volume of superfluous labor that may be present in the economy. However, the state sector fits remarkably well with Marx’s definition of a product of labor that is not a commodity in chapter 1 of Capital. Engels emphasized this point by inserting the statement:

“In order to produce the latter, he must not only produce use values, but use values for others, social use values. (And not only for others, without more. The mediaeval peasant produced quit-rent-corn for his feudal lord and tithe-corn for his parson. But neither the quit-rent-corn nor the tithe-corn became commodities by reason of the fact that they had been produced for others. To become a commodity a product must be transferred to another, whom it will serve as a use value, by means of an exchange.)” [My emphasis]

According to labor theory, then, a product of labor transferred by taxes, tithes, etc., is not commodity exchange. If my reading of Engels is correct, the entire state sector of ‘the economy’ is, by definition, superfluous to the production of material wealth.

The results of my calculation

Using the state sector as an admittedly imperfect proxy for non-value producing labor in the ‘economy’, one thing stands out. Almost forty percent of the U.S. ‘economy’ consists of labor time that, by my crude definition above, produces no value. This is down slightly from the immediate aftermath of the financial crisis, but continues to trend upward over the long-term, as the chart below shows:

States sector spending as a percentage of total US GDP

States sector spending as a percentage of total US GDP, 1900-2015 (sugovernmentspending.com)

On top of almost 40% of social labor time that I am using to crudely  approximate superfluous labor time in the economy, are some 37% of all workers who no longer participate in the labor force at all. This measure of the reserve army of labor has been rising at least since 2000, reflecting a persistent failure of fascist state “full employment” policies.

Percentage of workers who are not participating in the labor force

Percentage of workers who form the labor reserve army, 1948-2016 (St. Louis Federal Reserve Bank)

Taken together, these two categories are critical to our analysis of the potential impact of labor hours reduction.

According to the figures supplied by the capitalist state, of every 100 workers in the U.S. economy, almost 37 do not participate in the labor force, per BLS statistics. Perhaps a further 39 workers are not employed productively, but perform superfluous (even outright destructive) labor, like serving in the far-flung network of U.S. military bases and working in defense-related industries serving this vast network.

Incredibly, of every 100 workers available to work in the United States, then, only 24 workers are actually employed in sectors that can be said to produce value, while 76 out of 100 workers either produce no value or are in the labor reserve.

Implications of my calculation for labor hours reduction

In the United States, the legally established social working day is eight hours. If 63 out of every 100 workers is employed the aggregate social labor day is 504 hours for every 100 workers. But, as we have seen above, another 39 of the 63 employed workers are employed yet produce no new value themselves; leaving us a mere 24 workers who are both employed and produce value. The aggregate value of the social product of the working day per 100 workers is thus only 192 hours of productive labor.

In most of the literature I have read, writers assume a marginal reduction of hours of labor would be sufficient to absorb the unemployed into the active labor force. For instance, with the broadest measure of unemployment, U6, presently standing at approximately 10%, a reduction of hours of labor from 40 hours per week to 36 hours per week would be sufficient to eliminate all unemployment.

This is a terribly wrong assumption. In first place, the number of workers who are today locked out of productive employment is far larger than those defined as unemployed in fascist state statistics. It includes a massive body of women, black and brown workers and a huge hidden mass of migrant labor. Communists ignore the huge mass of the labor reserve at their peril.

Further, this is where the critical labor theory category of superfluous labor time comes into play: Of the 504 aggregate hours of labor hours worked for every 100 workers in the U.S. economy, only 192 hours of value is today being produced; the rest of the labor time is wasted and creates no value. This is because of the 61 workers out of every 100 with jobs, only 24 workers, produce value: 24 times 8 hours equals a mere 192 hours of value.

While it may appear possible to absorb the officially defined 10% unemployed workers by reducing hours of labor from 40 to 36, this reduction in fact would only negligibly affect a portion of the presently unproductively employed workers, while leaving the unemployed and the larger reserve labor force completely untouched. And, as I argued in the previous post, Marx’s argument suggests it will actually have a negative effect on overall employment, causing it to rise. To actually draw the reserve army into production, hours of labor have to be reduced from 8 hours per day to 2 hours or less per day.

Yes, you read that right: a two hour social labor day is possible right now!

The result of my rough calculation is surprisingly close to Keynes’ own estimate in 1930 that, within 100 years hours of labor could be reduced to 15 hours. The available data suggests if both superfluous labor and the industrial reserve army were absorbed into productive employment, hours of labor for everyone could be reduced to less than 10 hours per week.

Would this be enough to uusher society into a fully developed communist society? Yes. And I will show why in the conclusion to this series.

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