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Exploitation and super-exploitation

Introduction

“Communism is not a doctrine but a movement; it proceeds not from principles but from facts,” said Frederick Engels. Wide international differences in the rate of exploitation, the huge global shift of production and of the centre of gravity of the industrial working class to countries and regions where this rate is highest, the dramatically heightened dependency of firms headquartered in imperialist countries (and likewise of prosperity and social peace in those countries) on the proceeds of this exploitation—these are the most important facts about neoliberal capitalism from which we must proceed. Extreme rates of exploitation in Bangladeshi garment factories, Chinese production lines and South African platinum mines is a palpable, directly observable fact, experienced every day in the flesh by hundreds of millions of workers in low-wage countries. We don’t need a theory to know this, we only need to remove our blinders and open our eyes. But we do need a theory if we are to understand what we can see and work out the consequences that flow from it.

Monopoly and competition

It is useful to consider how exploitation and super-exploitation stand in relation to another essential constitutive element of capitalism: competition/monopoly. Monopoly is inscribed in the DNA of capitalism—individual capitalists don’t so much strive to compete as to find a way of avoiding competition, to get an edge over rivals, to exercise some form of monopoly that will give them higher than average profits. Competition results from the incessant efforts of individual capitalists to violate the fundamental law of value, i.e., the exchange of equivalents by buyer and seller. Their wild compulsion can only be contained by an external force, hence the necessity for a state and system of laws independent of individual capitalists—and hence, too, the ceaseless attempts of individual capitalists and groups of capitalists to capture the state in order to satiate their hunger for monopoly profits.

Monopoly comes in many forms. Some pertain to production, i.e. technological innovations that allow an individual capitalist to produce a given commodity more efficiently than others; others to distribution (branding or other forms of monopoly in the marketplace, barriers to new entrants, state capture, privileged access to cheap inputs, etc.); all may be short-lived or long-lasting. Common to all forms of monopoly is that they redistribute surplus value between capitals, enabling individual capitalists or groups of capitalists to reap extra profits by selling commodities for more than their prices of production (i.e. prices which equalise the rate of profit) at the expense of lower profits for the rest.

On the other hand, none of them increase the mass of surplus value available for redistribution. This is even true of technological innovations that reduce the quantity of labour required to produce workers’ consumption goods—only when this innovation becomes generalised, i.e. when it ceases to be monopolised by an individual capitalist, does it result in a lowering of the value of labour power and a corresponding rise in the rate of surplus value—and only then if none of these gains are captured by workers through higher real wages.

Exploitation and super-exploitation

While monopoly is all about the distribution of surplus value, exploitation is all about its extraction. And just as every capitalist dreams of becoming a monopolist, so it is in the DNA of every capitalist to seek ways to maximise the extraction of surplus value. In Capital Marx analyses in detail two ways capitalists do this—by extending the working day beyond ‘necessary labour time’, i.e. the time needed to replace the values consumed by the worker and her/his family, which Marx called absolute surplus value; and by reducing necessary labour time via productivity advances that cheapen workers’ consumption goods, which he called relative surplus value.

Both are entirely distinct from the reduction of necessary labour time through lowering workers’ consumption levels. As Marx explained in many places in Capital, “pushing the wage of the worker down below the value of his labour-power” is “excluded from consider[ation] by our assumption that all commodities, including labour-power, are bought and sold at their full value;” and he also stated that “the distinction between rates of surplus value in different countries and hence between different national levels of exploitation of labour are completely outside the scope of our present investigation” (for references and further discussion, see my article Imperialism in the Twenty-first Century).

Neither absolute surplus value nor relative surplus value, separately or in combination, are on their own sufficient to explain the value relations of contemporary globalised production networks. Attempts to do so fail the test of theoretical coherence—Marx explicitly excluded reduction of workers’ consumption levels from these concepts. And they fail the empirical test—the shift in the production of so many consumer goods to low-wage countries means that the wages and productivity of workers in these countries have become major determinants of relative surplus value in imperialist countries. What’s new about this is its vast scale; the exceptional importance of Ruy Mauro Marini’s contribution to the Marxist theory of imperialism lies, in part, in his observation that, during Karl Marx’s own lifetime, imports of cheaper food and other consumption goods produced by super-exploited labour in Britain’s colonies and neo-colonies helped increase relative surplus value within Britain itself, reducing necessary labour time without lowering consumption levels.

If Marx’s concepts of absolute and relative surplus value are insufficient to explain the realities of exploitation in contemporary global production networks, what else do we need? The short answer: a theoretical concept of super-exploitation. As we have seen, Marx repeatedly and explicitly excluded both the suppression of wages below the value of labour power and international variations in the rate of surplus value from his ‘general theory’ of capital. Reduction in the value of labour power by suppressing consumption levels (or what amounts to the same thing, shifting production to countries where workers’ consumption levels and the value of labour power is much lower) is a distinct, third way to increase surplus value, and it has attained incredible importance during the neoliberal era, the driving force of its greatest transformation.

Rediscovery of this third form of surplus-value is the breakthrough that provides the key to unleashing the dynamic concepts contained in Capital, and it was made by Andy Higginbottom in a 2009 conference paper entitled The Third Form of Surplus Value Increase, building on the work of Marini and developed further in a series of ground-breaking papers and articles (see here, here and here). In his 2009 paper he said, “Marx discusses three distinct ways that capital can increase surplus-value, but he names only two of these as absolute surplus-value and relative surplus-value. The third mechanism, reducing wages below the value of labour-power, Marx consigns to the sphere of the competition and outside his analysis.”

Conclusion—Imperialism, monopoly capitalism and super-exploitation

Now we can put these two constitutive elements of capitalism—monopoly/competition and exploitation/super-exploitation—together. As we saw at the beginning, every capitalist dreams of becoming a monopolist, but for capitalists in Vietnam, Cambodia, Mexico and other southern nations their dreams remain just that, dreams; they have no choice but to rely exclusively on the extraction of surplus value from their own workers by super-exploiting them up to and beyond the limits—or rather, to rely on what’s left to them after monopolists and imperialists have taken their share (China is an extremely important but as yet partial exception to this, which is why it is on collision course with incumbent imperialist powers, principally Japan and the United States). On the other hand, monopolists and imperialists do have the option of sharing some of their monopoly rents and imperial rents with their own workers—to buy social peace, to expand the market for their goods, and also to finance state expenditure on hard and soft power in order to reinforce their imperialist domination over subject nations.

To conclude: the capitalists’ monopoly impulse, i.e. the desire to capture surplus value at the expense of other capitalists, along with their insatiable lust for super-exploitable labour, combine together to define capitalism’s innate, inexorable imperialist trajectory. The transformations of the neoliberal era represents not the supersession of imperialism, as legions of imperialism-deniers who claim allegiance to Marxism contend, but its culmination.

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