Contents - Introduction - Labour - Class Struggle - Conclusion - Home Page - Index

The Organisation of Capital
— the economic-rationalist nightmare

There isn't anything you can't get done these days, if you've got the money to pay for it. On the other hand, never has there been a society in which everyone is so hopelessly incapable of doing even the simplest thing for themselves. The depth of dependence of all upon all is matched only by the dizzy heights of social power.

The power of any person is measured by the quantity of money that they are able to dispose of, particularly if it is their own money. Apart from a small minority born to money, the only way to acquire even the smallest share of this power is by "getting a job".

I don't think it is true to say that the wealth of today's society "presents itself as an immense accumulation of commodities" if we were restrict our understanding of the word "commodity" to tangible things. Tangible things nowadays in fact are rapidly obsolescent rust-prone throw-aways - but in the true sense of the word "commodity", as human labour for sale — this is true to an extent hitherto unimaginable. Today's collective nightmare is that of an immensely powerful society made up of unutterably powerless people.

Over the past decade or so, the whole world has been undergoing extremely rapid change. There is still a lot of the old world being dragged along, but if we want to know where this process is leading us, we need to look at what is essential in bourgeois society today, and in particular we need to separate out those tendencies which flow from the inner nature of capitalism from those forces which still hold it in check or stand in its way.

The Essence of Capitalism Today

1. Service-Commodities

Formerly, it seemed appropriate to talk about labour being alienated in the form of its embodiment in a tangible commodity which circulates on the market independently of the will of the producer. Clearly, this form of alienation of labour is still ubiquitous and probably dominant. However, whereas service-commodities, such as the labour of a private-school teacher, a cook or programmer, was formerly seen as a special case of a commodity — a strange commodity which was intangible, and traded only in the act of labour — it may now be more appropriate to look at services as being the archetypal form of alienated labour, with the tangible commodity being a special kind of service which is consumed separately from the act of creation. It is a fact that the world's richest man is a producer of intellectual property and that the composition of the labour force in the advanced capitalist countries has shifted and is shifting decisively in the direction of service industries, particularly through the socialisation of women's labour.

The significance for social consciousness of a change in the form of the commodity is in the change in the spatial and temporal aspect of domination. It is less true today that people are dominated by the labour of past generations, since most of the efforts of previous generations are rust-buckets nowadays. If the dominant form of commodity is services, then they express themselves now, in the subjective presence of the service-worker, but frequently across a global network of cooperative labour. It appears to be the whole community, immediately present, which dominates our lives, rather than the weight of past labours.

2. Socialisation of Women's Labour

The provision of unpaid labour by women in that form of the domestic bondage known as the Family is at an end, as women participate in the workforce either in formerly male domains or in the new industries created by moving what was women's work into the commodity market. These include health-care, social services, most of the retail trade not to mention fast-food and the whole food processing industry, and the manufacture of textile, clothing and footwear, domestic "labour-saving" appliances, etc., etc. Probably more than fifty percent of human labour which was performed outside the market is now socialised, mainly in the service sector [1]. Even those functions which women performed beyond the bounds of the immediate nuclear family as carers are regulated so as to exclude "unqualified" people from contributing.

The socialisation of women's labour is the single most significant factor propelling the change in the form of the commodity.

The liberation of women from domestic servitude has left a certain stigmatisation of unpaid work. However, it has also removed the social support network formerly provided by the family and no longer provided by the welfare state. The outcome of these opposite tendencies has led not to an elimination of voluntary association and the absorption of all social relations in the market, but has stimulated a still small but important growth in all manner of voluntary association. People nowadays rely on their friends from the aerobics club or TAFE course, and participate in the Parents-Teacher Association, their Community Association, Neighbourhood Watch or whatever — a thousand-and-one different networks of voluntary association, rather than the simple family-and-neighbourhood of the olden days or the State of more recent times.

3. Knowledge-Value

In its youth, it was the "rust industries" which formed the foundation of the dominant capitalist nations. Nowadays, it is knowledge-intensive and image-intensive industries which, aside from finance itself, are the dominant service industries. Knowledge-production is an "industry", that is, knowledge is becoming something which is bought and sold on the market, something which has value.

The world's richest man, Bill Gates, has built his fortune exclusively on "intellectual property" — software. Ahead of the Getty junior, he is now also the largest trader in images. Software, education, consultancy, media production, data-management etc., are now the fastest growing industries. The richest and most powerful countries are "knowledge exporters" — patents and copyrights, scientific research, higher education, consultancy, financial services, advertising, images, films, CDs, news networks, databanks and so on — while remaining net importers of capital. They have long since ceased to be exporters of industrial products. And it is generally believed that the dominance of these countries is inextricably linked to their dominance of these "knowledge industries".

Medical research and drug development is now carried out predominantly in privately funded research institutes, or in public institutions but funded by private interests who retain control of the output. Patents are jealously guarded, and discoveries kept secret, even at the cost of causing death and suffering as a result of suppression of information about side-effects or other defects in new drugs, and delaying the progress of competing companies. While government services are more and more being contracted out, "commercial in confidence" principles are being used to deny access to the public to information about public issues now being dealt with through the private sector. Meanwhile, "FOI" legislation means that information of public significance held by public bodies is available to anyone for a price, but knowledge held as private property is immune from "FOI". Thus, the public domain generally is suffering from a degradation and denial of knowledge which is increasingly the exclusive property of private companies.

Large companies now trade exclusively in data, collected through electronic financial transactions, bar-codes and so on in the private sector and provided at a price to anyone willing and able to pay. The extent and detail of such information is stunning, and surpasses by several orders of magnitude the mass of data held by any secret police force in history. Even warfare is now primarily a question of knowing (by satellite spying for example) exactly where your enemy is, rather than the fire power you are able to deliver. Even wealth in the most normal sense of the word is now nothing more than figures held in the databases of various financial institutions.

The form of knowledge and the mode of its circulation and development have also changed profoundly in recent decades in a way intimately tied up with the changes in the social relations of production.

4. Privatised States

Whereas the state has for long been involved in carrying out a range of functions necessary for the community and regulating the working of the market and guaranteeing the value of the currency, this is becoming a thing of the past. The role of the central banks in controlling money-supply and interest rates remains a vital part of the whole system, but it is more a question of correctly responding to the demands of the market than of exercising any positive influence, and the margin for error seems to get less and less.

The market is predominantly a global entity in which nation states are small players, states are shedding their role as providers of welfare and infrastructure and where they are active at all, these functions are carried out by contracted-out and privatised services purchased by the state. The major creators of credit are the speculators, overshadowing even the private banks.

The stateless "free enterprise zones" are now more the norm as regards the regulatory conditions of manufacturing industry. (By means of the internet, even service industries are now operating from "enterprise zones" and delivering services to remote corners of the globe). There are still some functions which capital is not able to carry out on its own account, but these are diminishing in number and significance. The state has everywhere been reduced to the role of an armed tax-collector — self-employed mercenaries. And states everywhere enjoy the contempt of all their citizens.

The preference these days for "self-regulation" and "voluntary codes of practice", though not always successful, indicate the tendency, that the state is not only unwelcome as a regulator, but in the long run is ineffective. New Zealand has demonstrated that there is absolutely no function of the state which cannot be privatised. (The National government elected therefore some years ago to a state where there was a very significant public sector privatised everything, even unemployment benefit payments, leaving only a core of legislature, executive and police-military under the state).

5. Contracted-out Companies

It has long been accepted that the internal structure of a company is in a sense "isolated" from the market, in that once the employee is engaged she works under the direction of capital and produces a product in a way that is "planned".

This is increasingly a fiction. Those services required by a firm which are not contracted out are carried out under threat of contracting out and the relationship of manager to supervisor and supervisor to employee more resembles that of buyer and seller than giver and receiver of commands. We should imagine the form of planned direction or persuasion as the secondary mode of organisation within each capitalist enterprise, and see the essential process of organisation as that of purchase and sale from beginning to end.

All the major corporations now treat their national subsidiaries as separate entities and while tying them up with one-sided contracts, give only minimal preference to them in dealings. The products of the parent are not transferred, but sold to the branch, and both parent and branch endeavour to maximise their own profits. The parent company is not particularly interested in having a profit returned from a branch, but more in selling products through them. This mechanism is quite efficient in repatriating profits to the home country.

Rather than maintaining a particular department of their company for the contribution it makes to the support of a firm's core business, large corporations prefer to shed employees and out-source subsidiary functions (building management, financial operations, distribution). It may even be that the apparently core manufacturing function is the one that is regarded as least profitable and may be out-sourced while the main capital is concentrated in distribution. This process is nothing more than the further development of the division of labour.

6. Contractors not Employees

Wage-labour is largely a thing of the past.

Increasingly, workers are so-called independent contractors or at best part-time casual employees enjoying a mockery of continuing employment. The shrinking band of regular employees, insofar as they are not brow-beaten into conditions approximating that prevailing among the pool of contract labour "outside", are cast in a supervisory role. And this state of affairs is not confined to the bottom end of the labour market. Short-term, performance-based contracts are nowadays the favourite means of employing senior managers. The continual pressure and threat of out-sourcing is often manifested in "competitive tendering" of the work of regular employees, who have to act as if they were independent contractors.

Wage labour has always been regarded as the classic form of labour in bourgeois society and is the norm for analysis of the social relations of capitalism. Wage labour is also the relation which underlies proletarian self-consciousness. Not only does the sociologist categorise the independent contractor differently from the PAYE employee, but the worker herself is subject to redefining herself when becoming "her own boss".

Our daily experience confirms however, that the capitalist chooses to purchase a service from an independent contractor precisely in order to increase the rate of exploitation. But likewise, we see the working day being shortened for many workers who find themselves semi-employed as a result of the same processes, while most workers who are still wage-labourers find their hours extended more than ever before. In certain kinds of casual labour, hours are extended in the extreme, particularly where piece-work is applied, such as in the case of the sweat shops in the rag trade and in the "Enterprise Zones" operating in various countries. One way or the other, the dynamic is to create conditions where the worker herself is motivated to work more and more hours.

It is a central contention of this paper that wage-labour is NOT the definitive condition of the proletariat. What defines the proletariat is the ubiquity of market relations and the condition of having nothing to sell but one's capacity to work. Whether the labourer ends up selling the use of her labour power to a "puppeteer" or delivering the completed product in the form of a service is a secondary question. In fact, it may even become a matter of small significance if the labourer sells a completed product, being obliged also to provide her own materials, components, work premises and so forth.

This is not to deny that the various modes of employment of labour do not have an effect on the consciousness of the labourer. Far from it. But our primary concern must be to understand the production of the dominating illusions of the epoch, the spectres which enthral us all, and only from the standpoint of such an analysis can we understand the particular illusions fostered in an individual's mode of relation to social labour.

7. De-regulated Labour Market

The political action of workers, the threat of social upheaval at various times, and through the agency of social-democratic governments or through pressure on liberal governments, and in combination with the inability of capital to meet all the needs of the community through its own resources, has secured a public sector and certain statutory rights for workers and there exist a whole range of industrial and legal instruments regulating working conditions. However, all these are rapidly disappearing, enterprise bargaining and award stripping in Australia is reducing the rights of workers to only those rights which workers can secure and maintain through their own collective action against their own employer. In looking at the essential process of capital and labour, we should ignore the very existence of awards and employment law.

Union membership in Australia where there has long been a high level of unionisation, is rapidly declining. Firstly, the public sector, which has been a strong base for unionism since the great public utilities were taken into state-ownership, is being broken up, corporatised and privatised. Secondly, the large manufacturing industries dominated by blue-collar wage-labour are declining in overall significance and suffering increasing differentiation between a core of full-time employees and a mass of casualised and out-sourced labour which is largely unorganised. Thirdly, in all parts of the economy, white-collar service and knowledge-workers have become a larger and larger proportion of the workforce and the ethos of collectivism has been slow to take hold in these strata even where wage-labour predominates. Where "factory" conditions apply in white-collar jobs, unionism is doing OK, but in workforces where there is a lot of differentiation, unionism has had trouble recruiting the upper layers. Fourthly, the expansion of contract-labour and self-employment, even in hard-core building trades, has undermined union consciousness. Fifthly, the proliferation of scattered work organisation within the large employers has made organisation difficult. Sixthly, the mass media has swamped the informal means of communication on which organisation depends, but this tendency may now be on the decline with the rise of the internet. Seventhly and finally, and perhaps above all, the ethos of the market which now dominates everything fosters individualism and resignation.

It would not be worth the trouble of writing this paper if I did not believe that this situation was reversible, but what I contend here is that there is nothing in the development of capital itself other than a further extension of this tendency.

The Difficulties of Analysis

In this world, the distinctions between trade and production, between the creation of a need and the satisfaction of a need, between production and expenditure, even that between employer and employee, have been blurred. For the theoretician, this is no more something to be overly concerned about than is the difficulty of separating the north and south poles of a magnet.

These tendencies, which are the work of capital — the specific form in which human labour is mobilised in this society dominated by exchange of services — are but one side of the totality of human life as it is today. The other half is organised labour. While both these human forces grow under the same conditions, in opposition to one another, while mutually conditioning and engendering one another, it is not the intention of this paper to derive each of these opposites as determinations of a single essence, since the essence of organised labour is irreconcilable with capital and cannot develop and acquire its truth except by the abolition of capital.

Nevertheless, it is necessary to separately identify before our eyes each of these two forces of production.


Money, and money in the form we find it today, is the outcome of a long historical process. But how can we understand anything that is going on today unless we begin from money in this most developed form? We can go back to some purported starting point, and follow the development of money from barter to gold to the various forms of credit, but this is a complex task of historiography, and in any case, it is now that we see the truth of the whole process. A social relation was put upon a material substance, which thereby took on a mystique. But now the materiality of value is disappearing. Value is becoming an avowedly mental substance.

Money (coins and banknotes) still exists, but it is small change, small change for buying newspapers and cigarettes or lubricating the margins of the economy. Essentially and in the main, the form of value is the registration of a credit when a service is delivered and the deduction of amounts for bills, purchases, taxes and services received. And money functions as money, in all the modes of activity previously known, and more, all the more effectively for it. So it makes more sense to see the process of adding and subtracting amounts on bank balances as the essential process, and the cashing out of bank balances and the proffering of cash as the peripheral and derivative form.

Here I will restrict all talk of money to this most developed form of money, where the means of circulation has become qualitatively indistinguishable from the form of credit. When I say "money", I mean an "account".

In the past it was necessary to distinguish between money-capital and money-cash, and the distinction was more than quantitative. The quantitative distinction remains, but there remains no real qualitative distinction. The fact that 40% (for example) of the population owns shares — and if we include superannuation the percentage is even higher —is not a nothing. A situation in which a tiny proportion of society enjoys real power is as much a class society as one in which the workers do not even have a bank account or own more than the shirts on their backs. But at the same time, it is a real aspect of this stage of development of capital that day-to-day subsistence is managed by very small ups and downs of very small accounts in the same banks as the millionaires.


The other great mystique of modern bourgeois society is the "job". Money and a job.

A few of us are born to money, and some will be lucky enough to be able to enjoy the sunset of our lives on the earnings of money by the time of losing our last job, but the vast majority leave the dependency of the home and compulsory education as "free labourers", with nothing to sell but our own human energies, mental or manual, in search of a "job".

It is one of the most curious things about the appearance of today's world that it is the employer who is giving something and the worker who receives when he is "given a job". But this is a very persistent appearance. While "jobs" become less and less like stable, secure and continuing things, and become more and more transient and intangible, the illusion of a job being a thing to be found becomes stronger and stronger and the idea that a "job well done" is something given, and a service provided, becomes less and less tenable.

But at the same time every job is a service. The worker no longer gives her energies to be manipulatedby an employer like any other tool, but must give the entire service in the form of a finished commodity. Through the various forms of "quality control" and "change management" and a thousand other euphemisms promoted by the management gurus, individual workers and work-groups have been obliged to take on full responsibility for management of their own labour: only the final product is measured and paid for.

What is the difference between a job and a service; when does the boss become a customer, and when does the customer become a boss? The bricklaying subcontractor sells bricklaying to the builder on a major city building site, but if times are tough will equally sell the same bricklaying service to the home-owner adding an extension to the triple-fronted. A few years ago, she was a full-time employee of the builder, but was "given a package" and now quotes for each job as it comes and pays her own insurance and holiday pay, etc. The builder is still clearly the boss, but the relationship with the builder is no different from that with the householder who employs the services of the bricklayer but once in a lifetime.

But we know there is a difference. The builder employs the services of the subby solely for the purpose of adding value to the building and making a profit, i.e., extracting surplus value; the home-owner must save up for years and spend the money in order to have some more walls on her home. Both buy the same product for the same price, but one makes an investment while the other spends savings.

Continuing employment has a huge place in our world, and generally people would regard it as the norm — the days when wharf labourers had to report to the dock gates for a day's work are long gone. (Even then, only a minority were in this condition of insecurity, while the majority of employment in the capitalist economy was in large enterprises where employment was insecure and subject to arbitrary sacking, but was in general continuing employment). Since those bad-old-days, employment has become generally more secure. But that process has been reversed in the last decade or so.

In the building trade, the use of so-called "sub-contractors" is widespread, home-workers supply the rag trade with cheap labour on piece-work, large corporations out-source parts of their organisation and former employees contract to do the same work on a project-by-project basis; the large manufacturing companies may employ a core of permanent workers, but components are supplied by small companies that come and go and employ casual labour; working conditions in the "free enterprise zones" around the world approximate those of unskilled workers 100 years ago in England. And so, even those that do have permanent jobs live under constant threat of out-sourcing, and essentially work "as if" they were outsourced.

The Illusions of Postmodern Capitalism

As compared to the rising manufacturing based capitalism which Marx dealt with in the nineteenth century, we see:

The purpose of studying these things is to understand the basis of the forms of consciousness which dominate life in this post-modern capitalist world. One of our tasks must be to explore each of the social concepts which are manifested as apparently natural objects in this world and uncover their real social basis in the division of labour.

The relation between knowledge and value is essential for an understanding of these forms of consciousness, particularly since we can observe that these two concepts which throughout history exhibit a strong relationship, are now converging. On the basis of understanding the relationship between knowledge and value, we must explore the meaning of ethics and its relation to a transcendance of value relations.

In order to complete this work though, we have to answer the "fundamental question" of political economy: how is surplus value extracted from the labouring people in this social arrangement? Further, the whole purpose of the exercise is to find a way out of this mess, to find out what it is that prevents people from freely entering into voluntary relationships for the purpose of producing and reproducing their lives. Consequently, I want to explore the situation of a free worker today, who begins as she must with the question: "How can I live?", and from there to the questions: "How I am exploited?" and "How can I live without capital?"

The Human Condition under the Rule of Capital

My First Job

I work because I am a human being and as a human being I expect to be able to live. But I can only work and live with the cooperation of others. Unlike previous generations I am not born to a given role in a fixed system of production relations. I do not follow my father into the business or trade. In fact he was laid-off before I start work and the job he did no longer exists. I am a "free labourer" and must find work and a living.

This is the overwhelming fact of life which greets me as I reach maturity. My older brother failed to find work, hangs about with the other boys in the park and will probably OD before long. I don't want to end up like that.

How can I live? I have no means of growing food and in fact I can't even cook or sew a button on to my jacket, I must seek medical attention for the slightest ailment and even for loneliness and stress. My friends and family live hundreds of miles away. I am utterly dependent on the cooperation of my fellow humans for everything. Not even other people can help me on their own.

I completely depend on the support of this impossibly complex network of cooperation for my every need. But I learn the rules of this system pretty quickly. I will get absolutely no help except in exact proportion to what I contribute. But this poses the most difficult problem of all: I can jump up and down, run round the block and learn to recite the complete works of Shakespeare in brail, I can clean the windows of every shop in the Mall and spend my days helping old ladies across the road. But it won't do a damn bit of good until I get my first job.

I am free to do as I will; no-one tells me what I should do with myself. But unless I can find a job, paid employment, I am done for. Although all my needs may be met only by this complex interdependent network of support, as in an enormous game of "musical chairs", I can find no place in it that has my name on it. I must seek out and be granted a 'spot', and run like hell to get up to speed and hang on to my "job". My activity at work bears no relationship to my own needs or beliefs. The only connection is my bank balance, which I can open the day I get my first job.

The System of Needs

I cannot live other than by finding a job in this network of relations. But on the other hand, my needs are both met and produced by the cooperative action of the entire world. Hardly a single need is met that does not in some way owe its satisfaction to the contribution of millions of people all over the world. It is said that any two individuals in the world can be joined by as few as six links in the network of exchange. Things are passed from hand to hand, their forms changed and combined with one another, programs, plans and designs undergo successive adjustment and perfection. And my needs are as much themselves products of this system as the objects I use to satisfy them. Indeed it is hard to determine whether the production of some services is acting to meet or create their "market". Ten years ago, who lacked internet access?

Since it is money that binds this global community together, it is quite impossible to conceive of it without money; or more exactly, we must first conceive of it as it is, a system of social relations sustained by money, in order to be able to conceive of it without money.

As we remarked above, it is taken as given here that the relations of production have surpassed the form of wage labour to the maximum degree possible, but this by no means implies that exchange is the only relation between people at work. Exchange is only the means by which cooperation is achieved. Exchange in itself produces nothing. However, exchange is as much a force of production as is labour itself. Try producing without the aid of money. We've already been down that road.

Let's just have a look at how people manage to cooperate in this system.

Social Labour

People can cooperate in serial or parallel. That is to say, the service they provide together can come about through the action of one upon the product of the other as it is passed from hand to hand, or by the action of each with many hands acting on the same object. Social production is impossible without the combination of both modes of cooperation and one cannot be counted less than the other. I cooperate with you equally as much if I change the form of what you have already acted upon as when we both act simultaneously upon the same object. A moment's reflection will show that unless a service is produced by a combination of both, then only the most primitive and restricted forms of production are possible.

Through the complex network of these relations of cooperation, people working at opposite points of the globe and separated in time, nevertheless cooperate through a process mediated in a numerous variety of ways. Whether there is any material carrier traceable through this network of cooperation is neither here nor there but is the exception rather than the rule.

The nurse, doctor, cleaner, technician, pathologist and cook cooperate in making me well when I visit the hospital, but their labour is not materialised in any object other than the state of my mind and body when I leave. Nevertheless, the complex network of transactions across the entire medical system (at least!) all contributes to the healthy outcome. And yet it cannot be said that all these people — the plumber reading the gas meter, the timber worker felling the tree for the toilet paper, the programmer loading on to the web the technical paper which will advise the doctor, etc., etc. — have my health in mind when they do what they do. Not at all. If anything is on their mind at all, it is home-time and pay-day.

So, there is nothing of the human will in this process of creating and satisfying the needs of the community, without even going into the question of the sense in which people need to be blown up by land-mines or hood-winked by pokies, which equally as much as my good health are the outcome of the same collective labour. But this is the means by which the communities needs are met, and since it is also the means by which the communities needs are created, it is pointless to take this or that outcome as good or bad; but the whole is truly inhuman.

Let's stick with the hospital for a minute. The surgeon provides his cutting for a consultant's fee as does the anaesthetist, etc. The nurses are casuals paid by the hour but organise their own rosters etc., the laundry, catering, cleaning, IT, accounting and building services are all contracted out and the building is rented; the management are all on annual performance-based contracts. Not a wage worker or owner-manager in the place.

Public and Private Funding

Let's now have a look at how this hospital might be paid for. There are currently two dominant modes of funding health care, the "public" and the "private" funding models. The dynamics of these two ways of providing for health care are quite different.

In the public funding system, the community allocates a proportion of the total effort of the community to health care by means of making an allocation from taxation revenue. The total amount of this allocation does not particularly dependent on any assessment of health "needs", but responds to overall political and economic factors and is empirically know everywhere to be on the decline. The issue here is the dynamic of management of this effort.

With a fixed amount of resources to manage, the objective of the managers of such a health system is to improve operational effectiveness principally by reducing demand on the system. This can be done by several ways: (1) preventive measures to improve the health of the community and reduce demands on medical services and medical practices which minimise relapse, (2) filter admissions by means-testing, by introducing charges or by discharging patients who are not sick enough or leaving "unessential" cases on long waiting lists, or (3) reduce funding to medical services.

In the private funding system, individuals purchase medical services according to their needs, and the dynamic which determines the proportion of the communities effort devoted to health care is as follows: the managers of the system need to stimulate demand for medical services, so there is no stimulus at all for preventive medicine but for example, (1) the promotion of new perceived illnesses will cause people to lay out money for cosmetic surgery, new wonder drugs and so on, and (2) the provision of these services with the minimum outlay of capital. The result is an increase in the proportion of the community's effort spent on health care, with the minimum improvement in health.

Now one thing comes through loud and clear from this picture. Unless there is a conscious and coordinated effort by the community to organise its health effort, it will be only a matter of time before the public system disappears and the private system takes over. As is easily demonstrated, this process begins with the transformation of public health via a "corporatised" public system with compulsory subscriptions collected via the tax system, via a "welfare system" operating side by side with the "real" health system to one of a range of private health systems each finding a niche in the market from low-cost low quality services for the poor, to high-cost high quality services for the rich. The education system is also travelling down the same road.

So in line with the methodology of this paper to follow the logic of the dominant and emerging trends in bourgeois society, we shall look at the situation of our hospital on the assumption that its services are paid for by one or another health insurance scheme. The hospital may be owned by a separate unit of capital or, as is often the case in the US for example, it may be owned by the health insurance scheme itself, or, conceivably, the insurance scheme may be a kind of membership system operated by the hospital. But let us assume, in line with the tendency of capital to "out-source" and infinitely develop the division of labour, that the health insurance company and the hospital operators are owned by separate capitals.

The Organisation of Labour

Before examining how our hypothetical hospital organises the efforts of health care workers, let us, by way of contrast, look the example of the fast food industry. With Australia accounting for 7% of Macdonald's world-market share, this is another growing industry at the leading edge of the development of employment and management practices. Food preparation was formerly carried out within the confines of relations of domestic servitude, but nowadays is predominantly provided through the market and the ever more numerous Macdonald's outlets are a significant part of this growth.

The franchisee must raise a small capital in order to get into the game; she then lays out a fee for purchasing the franchise and agrees to adhere to a range of practices including the purchase of a range of products from the franchiser. Staff are engaged by and large on a casual hourly-paid basis and property is rented. The young workers in general operate as a work-team within the fairly clear constraints of the franchise policy. The food arrives in such a way that preparation and serving is a simple enough task and the requirement for supervision is pretty light.

Whether the young workers are engaged as casual employees on a given wage rate or whether some form of piece-work is used is neither here nor there. A large proportion of the kind of employment youngsters are engaged in these days is already some form of piece-work. The workers in the abattoir, in the meat processing plant, the sweat shop where the uniforms are sewn up, the packaging factory, etc., will be on piece rates in any case, and the mobility of labour is such that the constant threat of unemployment can achieve the same effect.

Now, it is clear that the relation between the young workers in each component organisation and the manager is that of employee to employer, independently of whether the form of payment is contract, piece-work or wage labour. In each case, the "manager" is the owner of the income stream generated by her arm of the business or represents the owner. The franchisee will prosper or fail according to whether her particular franchise generates sufficient business, provided that the social-average productivity is achieved within the business. That is, she is a small capitalist evidently enjoying the fruits of her own investment and the profits gained from employing staff. But on the other hand, it is well-known that the real bickies accrue to the franchiser who holds the intellectual property for the whole business. In former days, the exact same result would have been achieved by employing the franchisee as a local shop-manager on a manager's salary. But if the manager was an employee of the larger firm, it would probably be up for review at the next board meeting anyway.

So the question: "Is the franchisee a jumped-up worker or a small capitalist?" is hardly the point. It is like asking whether a particular point in a magnet belongs to the north or the south pole. If we focus on the work-group, certainly it makes a huge difference whether the group is a collective or whether one of them is a franchise holder and legal owner of the income stream or manager of the firm which owns the product and employs them all. And further, an owner looks no different from a foreman or manager, from the standpoint of the kids serving the hamburgers.

So, the essential picture is groups of people working cooperatively to provide a specific service on request from a person who pays for the service and receives some income stream to which the services received contribute. And these services are themselves combined in the delivery of services. In this way possibly quite undeveloped labour is combined to achieve the provision of very elaborate services.

This network is marked out by exchange relationships which vary from, at one end, the delivery of individual labour in exchange for a livelihood, to, at the other end, the delivery of very sophisticated services (such as hospital treatment or fast food) in exchange for payment which is the source of both the means of payment of contributory services and profit. In between, services are sold by small entrepreneurs to other entrepreneurs as part of the production process.

It is a fact of postmodern life that it is more or less useless to attempt to divide this picture up into "Department I" and "Department II", or between wages and commerce. Equally vain is any endeavour to divide the participants up into wage-workers and managers, managers and owners. Not there is no distinction, but simply that the whole process is manifested in a continuum. The differences are very wide, and the system of production delivers vastly different outcomes to the different strata of society, and deploys power very unequally, but the point is that these class differences are not manifested in the form of individual owners of capital purchasing labour power from individual workers, and it is essentially so. As we shall see, the engagement is a subtler and more remote one, though all the more effective for it, and the forms of consciousness which correspond to this stage of development of bourgeois society are comprehensible only on the basis of these relations. I will come to the question of social class later, but it seems to me that those who bring their human energies to the production process are workers and in the system of bourgeois society they are proletarians; and those who gain a living directly from the proceeds of capital constitute the bourgeoisie, and nothing in these considerations weakens or undermines this conception. But more of this later.

Capitalist Enterprises

We come then to the question of how these businesses are organised. Each participant in this collective labour process contracts to do a specific job in exchange for money. The coordination or application of another's service is itself a service. The surgeon performs her operation by coordinating the efforts of the theatre staff together with her own handiwork and the labour of instrument-maker, consultant, radiologist etc.

The "bread-and-butter" of this particular activity is the income stream generated through the health insurance company for the delivery of a medical service to the insured patient. Thus, quite apart from the quality of each of the services delivered by component parts of this organisation — laundry services, IT, cleaning, pathology, nursing, etc. — which are paid for by the hospital, the crucial thing is the quality of the outcome of the coordination of all the component services into curing the patient, or more exactly, giving the patient sufficient satisfaction that she will come again and not sue.

As remarked earlier, what has been achieved in the hospital is the cooperation of the labour of millions of workers. Just for the moment however, our focus is on the form of cooperation which is taking place within the hospital, as opposed to the cooperation which could equally well have been manifested by the employment of the same services in a different hospital. We pointed out earlier too, that for all intents and purposes we can assume that each "department" of the hospital is an independent contractor employing contract labour, that is, that every single relationship in the hospital has the form of purchase of a service by contract whether it be the services of an individual worker or of a group, such as the cleaning contractor — a whole network of contracted labour.

Productive Commerce

But none of these workers and workgroups can separately or in sum produce what the hospital produces — a healthy, satisfied patient. It is inescapable that this value is created in the hospital, that the organisation of the hospital and the coordination of the various activities taking place within it is a new act of creation, labour.

This result is achieved through the combination of numerous instances of a specific type of relationship: the employment of a service provided by one or a number of others to provide a more developed service to a third. It may appear at first sight that this is nothing more than the supervisor stealing the thunder of the productive workers under her supervision, and claiming for herself the satisfaction of the customer achieved in fact by her employee. But this is by no means an interpretation which will allow us to reveal what is in reality taking place. The surgeon is as much the supervisor of the labour of dozens of others as she is herself an operative; the programmer brings the labour of other programmers, systems engineers and clerks together and in turn vicariously supervises and coordinates the labour of just about everybody else in the place. The plumber coordinates the labour of the tool-maker, the regulator and pipe-maker to install the customer's plumbing. All this "mental" activity is productive labour and it is in fact the very labour which is essential to the production taking place in the hospital.

The Syllogism of Productive-Exchange

Here we examine the relationship between the person requiring a service, the people providing the component services and the person mediating the component services to create the new composite service. This syllogism is both commerce (each relationship is one of purchase and sale) and production (the outcome is a use-value for one and a source of exchange-value for the others).

Let us suppose we have a buyer for a service, such as a patient at a hospital. We have a number of workers who carry out the component parts of the hospital service, and we have a hospital proprietor who buys the services from the workers and sells the composite to the patient.

In this relation, the workers provide health to the patient, but the proprietor mediates in this relation. The Universal is the patient to whose health all are dedicated. Each of the workers constitute a Particular aspect of the health care which is the Individual act of hospitalisation. In this aspect the labour process appears as an act of concrete labour.

However, the patient is also a buyer of the services of the hospital and indeed the hospital may have aggressively marketed its service, and whether the buyer has any natural, objective need of healing is neither here nor there. The proprietor is a buyer of the services of workers and the prey to the same gullibility as the patient, purchasing all sorts of services, the value of which may be quite questionable. In this aspect, the hospital is like a market in which the health workers manage to sell their products, the proprietor acts as a merchant, selling at a price greater than the price for which she buys, and the patient as buyer, and the whole process appears as commerce, a place where workers earn their living, and in this aspect it is the workers who constitute the Universal and the the proprietor is the Individual who mediates the particular health needs and skills to achieve commerical exchange.

However, the workers can sell their product only if the proprietor can use their services to produce something of greater value than the sum of the services taken individually and their will be no work unless such a surplus value is created. In this aaspect then, be it one of commerce or of the production of surplus value, it is the proprietor, as representative of Capital, is the Universal and the workers labour only to enlarge this capital. What they sell is to them only an exchange value, and they are no more interested in the health of the patient than is the proprietor. Each is interested only in obtaining what is useful to them: the workers their remuneration, the proprietor her profit and the patient alone cares for her health, but in this relation the patient is only mediating the relation in which the capitalist proprietor endeavours to augment her capital. Thus under this aspect the relation is one of production, production of surplus value.

The Individual and Universal Consumer

Particularly with modern "customer-focus" it is becoming more and more the customer who directs the workers' labour, and less and less the case of a skilled professional or trades-person who carries out her work according to standards of professional conduct nor one in which an entrepreneur directs the work of employees to the production of a product of which they have a particular concept. The interest of capital is only in the extraction of surplus value, and this is done, as it happens, all the more effectively the less capital intervenes in the process of satisfaction of needs.

This leads of course to all sorts of absurdities. The last thing a customer demands is standards; given the chance customers will buy the cheapest, most adulterated, least nutritious, gaudiest and shonkiest product available. In the market system, the needs of the individual and the needs of the community are poles apart, and only government regulation and responsible entrepeneurs provide "consumer protection". Under the guise of capital, the community comes to be represented in the form of individuals whose total, as consumers, is no more than the sum of their parts.

The Universal used to take the form of the welfare-regulator state, and this state expressed the wisdom of the community which rises higher than that which is manifested in the "war of all against all". The Individual subordinated herself to the Universal will in the knowledge that their own greater good was served by such a subordination.

Productive Domination

What is strange here though is that the relation of productive coordination is identified with relations of domination. The surgeon is not just the coordinator or leader of the workgroup in the operating theatre: she is clearly the boss and exerts power over all the other workers in the team. Likewise, the cleaning manager can make or break the various contractors engaged at the hospital equally as well as each contractor holds power over each cleaner; the Chief Nursing Officer who allocates the casual nursing staff can make the life of any of the nurses a misery or a joy according to her disposition, and so on, but stresses out with 12 hour days trying to hang on to her annual performance-based contract with the hospital.

The same is true in our Macdonald's franchise where the franchisee exerts pretty much break-or-break power over all the staff in the outlet while herself is subject to the quite ruthless manipulation of the franchiser.

Now it is well known that relations of domination may develop under a variety of conditions, but I would contend that the development of postmodern society is successively reducing and absorbing all such forms of domination into those arising within this system of organisation of production. In fact it is the very dominance of this productive domination which tends to undermine domination based on gender, nationality and so forth.

Workplace Cooperation

What do we make of the immediately cooperative labour among employees? It seems that this is essentially the same as voluntary organisation, although of course it is corrupted and disoriented — co-opted, in fact — by capital. This voluntary cooperation is the mode of self-organisation of labour itself, akin to the capacities of the individual labourer, an extension of her human creative ability, which is purchased and used by the employer. Nowadays, the management gurus quite deliberately tell the management to rely on the self-organisation of the workers as the superior means of improving efficiency in the workplace. Of course, the workers have no access at all to organisation of the labour process outside of the confines of the work-group (say up to a couple of dozen individuals) of which they are a part, far less any control over the labour process as it extends beyond the single capitalist enterprise. Nevertheless, it is remarkable (1) that the bourgeoisie recognise that the workers are better equipped to supervise their own work than management, and (2) the bourgeoisie are quite confident that workers' control of their own labour, shop-by-shop, constitutes no threat whatsoever to capitalist control.

The capitalist enterprise retains the "last say" over workers in relation to organisation of work in its own departments, but in the fully contracted-out enterprise this is not the case. In the capitalist enterprise, management also intervenes in the immediate cooperation of workers by the appointment (anointing) of the supervisor or manager, who has the power of hire-and-fire, or at least has sufficient authority to recommend that comes to the same thing, and in this way the wages that are paid by the larger enterprise become effectively paid by the local supervisor. Thus, even the large enterprise effectively reproduces the situation in the hypothetical fast-food franchise considered above.

Thus the relation is essentially not necessarily between and capital and the individual labourer, but between capital and self-organised labour. And we may validly include in the labour contributed by a work-group, the component of self-organisation as a real additional value over and above any "individual component" of the collective labour.

The big difference however between self-organised labour and the immediate cooperative labour carried out in a work-group in a capitalist enterprise is that one member of the capitalist work-group is either the owner of the income stream, and/or is given a special power over all the others in the work group, essentially the power to hire and fire. The power to renew or cancel a contract comes to the same thing.

The Flow of Money

Thus we find that it is the flow of money through the organisation which constitutes the force which:

  1. binds the labour of the work-group into that of the community as a whole, and
  2. introduces into the voluntary, cooperative labour of workers "productive domination".

In other words, money is both the glue binding society together and the transmission belt for social power, power which begins with a mass of capital and transmits itself downwards and outwards into the relationships within every work-group and returns with the "approval" of the community in the form of revenue. Obviously power exercised in this way by no means exhausts the power of money, but if money is not able to secure the production of services, then all other manifestations of the power of money come to nothing.

Money enables cooperation which otherwise remains impossible, but the achievements of social labour far exceed what is possible for any given unit of capital. It is the unitary character of capital, the fact that any unit of capital is interchangeable with any other and acts as a part of one global capital which makes the almost limitless capacity of social labour, and this process manifests itself through the purchase of services on an "anonymous" basis, the cooperation of individuals otherwise unknown to each other. In this binding mode, money here acts as if it were a natural supra-human force, bringing into being social cooperation which has apparently been willed by no-one.

In its second mode, money acts as the direct manifestation of will: "Do this and I will pay you". If, however, this wilful action fails to produce a use-value for someone and generate an income flow in return, restoring and expanding the expended capital, then the wilful flow of capital exhausts itself and comes to nothing, and the will which appears in the form of money proffered for the purpose of production turns out to be illusory, appearance only. Only to the extent that capital subordinates itself to the global demands of money-capital can it act as capital.

The business-owner, manager and supervisor therefore, in this sense, "speak for the community", that is to say, they perpetuate the particular mode of existence of the community bound together by money.

But even the punter turning up to the supermarket to spend a dollar exerts power in tendering their dollar. Minuscule as this power may be, as compared to the punter who has no money to spend, or the citizen of a "planned economy" in which the market has been "abolished", and the punters must take what they get, this power is not insignificant.

Money & Power

Capital both brings into being and disrupts the process of production. In our example, the hospital proprietor chose to "invest in" a hospital. But essentially the proprietor is not a health-care worker but a capitalist. She might equally well have decided to invest in land-mine production. In so far as capital places Immediate social power into the hands of an Individual, and acts as the lever of action for an Individual will, it disrupts production. The productive effect of capital derives only from its capacity to reflect the Universal will. In any immediate project capital either withers to nothing and fails to enlarge itself, or renews and augments itself, according to whether or not it succeeds in enhancing the social cooperation of labour in the meeting of a social need. But this effect is achieved exclusively through the destruction and recreation of capital, not in its immediate application. In any particular project, the individual is not identical to the universal, thus the apparent conferring of social power upon the individual is in reality the subordination of the individual to the universal, which is capital.

Surplus Value

Marx took a considerable amount of trouble to uncover the "secret of surplus value", which could be summarised simplistically as follows: the worker (at a given level of the productivity of labour and a given traditional standard of living) produces (on average, the equivalent of) what she needs to live (for a day) in less than a day; but the system of wage-labour obliges the worker to work a whole day, and because labour power is purchased at its value (less than a day's labour), and the application of this labour power by the capitalist (in a manner which is at least as effective as the norm) allows the capitalist to recover (the value of) a full day's labour by sale of the product and realise the surplus corresponding to the extension of the working day beyond the necessary labour-time.

Let us assume that instead of the system of wage-labour, the system of contracting-out is applied to the limit as described above. How do we stand with this explanation of the extraction of surplus value? If the worker is paid the value of what she supplies, how is additional, surplus value realised in the application of the human energies created by the worker in the act of labour, i.e., "service delivery"? How does the capitalist grow rich while the poor get poorer?

The Value of Labour-power

Where the service delivered is, as in for example the repair of cars or washing machines, expended and immediately recompensed, there is little room for exploitation, and these kinds of activity are the favourite ground of small business and self-employed workers. But where for example, many hands are applied in the provision of the service (as is the case in a hospital or university) and the service requires a long and complex process for recovery of the payment (as is the case in our hypothetical hospital, scientific research or programming or in all the manufacturing industries from motor cars to movies) before the income stream is generated, then there is a space into which capital may step. Consider how a retail chain or our hypothetical Macdonald's franchises make their money. The sheer scale of the organisation involved. Consider the tens of thousands who combine to make and show a film; how can these recover the costs of their services without the billions of dollars the finance sector can provide to the capitalist producer and distributor sustaining people in the meantime?

The sphere of mobilisation of large masses of labour is open only to capital. But let's have a look at those simple services which have been provided by individual workers for centuries. Marx makes the point that the wages of a soldier and the rates charged by a woodcutter or station-porter for immediate uncomplicated services, are set by the labour market. So when small scale services are offered for sale by individual workers, the rate for the job will be set to the going rate of wages — the value of labour, just enough to live on at the prevailing standard of living for the social strata in question.

Thus the working contention here is that the value of services delivered by individual workers direct to a consumer is equal to the value of services delivered to a point in the production process of more developed services. Now it is a fact that wages vary considerably from trade to trade. The costs of production of labour power of different skill levels is not particularly controversial and all the normal market mechanisms must operate, including the good old mechanism of "supply-and-demand.

However, it is also manifestly the case that the flow of money through the production process involves an element of "persuasion", of corruption and there is an element of certain types of worker getting a share of the revenue of capital. For the moment we will neglect this aspect of things because to deal with it at this point would be to assume what has to be proved so to speak, because up to here we still do not understand how a number of services can be contributed and paid for at value and nevertheless a profit made by sale of the total product at value.

Capital mobilises social labour

In the delivery of any particular service, big capital competes with small capital, the self-employed worker and with self-service, so to speak. Big capital generally does not (and for the purposes of political survival must not ) eradicate those forms of production which satisfy the need in question with little or no profit margin (the old point about the need for capital to sustain a petit-bourgeoisie). It is quite reasonably regarded as a social problem, for example, if the corner grocer is being forced into bankruptcy en masse by the supermarket. Both can sell the same product, but the supermarket will sell it cheaper and easier 24-hours-a-day, while the family business ekes out a living selling over-priced goods with members of the family supplying cheap labour for occasional purchases that the customer forgot to get from the supermarket. And the effectiveness of social labour mobilised by big capital combined with various forms of image-making and over-zealous regulation based on convincing people that less sophisticated services are unhealthy or dangerous, encourages people to look to the shopping mall to satisfy their every need, real or imagined.

The distinctive capacity of big capital which enables it to under-cut competition from small capital is that capital mobilises social labour, the resources of the entire community in fact, without limit. Without capital, there is a very definite limit to the complexity of social labour that can be mobilised. And there is the time factor: without capital, the commodity-service must complete the circuit back to commodity (means of sustenance) within a short space of time or the workers starve! Even if all the people who cooperate to produce and distribute a Hollywood film were to form themselves into a workers' cooperative, they would have to live out of the freezer for several years before getting their wages back from ticket sales, and you're talking of an organisation of many thousands spread across the world to achieve that! Of course, in a cooperative society in which exchange of commodities has been transcended, there would be no need for wages and the workers could live off the community like respectable beggars. But that is not the case. Somehow or other, if a large organisation of workers is to work for an extended period of time before receiving recompense, they must be paid wages, otherwise the organisational requirement extends to infinity. Even though the worker meets the needs of the community, no-one will give her the means of sustenance unless authorised by capital (by means of the worker being able to proffer money).

Profit and Value

Where does this leave us with regard to the capacity for capital to produce and sell products at their value and yet make a profit, extract surplus value?

When the worker presents herself to the capitalist to provide a service, she presents only her "uncomplicated", individual labour. The capitalist however, is able to combine this with the collective labour of the entire community, and thereby through the agency of individual workers, mobilises social labour.

Let us assume that the worker is paid the true value of the service she delivers, the full equivalent of her skilled but "uncomplicated" labour. That is to say, as the seller of a product, a contractor rather than a wage-worker, her product is sold at value, as a quantum of labour. But let us further assume that this payment is in fact the same as she would have been paid if she had been employed as a wage worker — the value of her "labour-power", approximating the costs of production of the human energies she brings to the job. A reasonable assumption, since, as remarked above, the "labour market" will determine this, and we know from anecdotal experience that this is roughly what is happening.

Under these conditions, if the socially average means of a worker sustaining herself were the consumption of the same "uncomplicated" services that she delivers at work, then there would be no room for the production of surplus value; the "necessary labour time" would be equal to a full working day and there would be neither "free time" nor surplus labour time available for exploitation by capital.

However, this is not how the worker lives. In general the worker consumes the products of immensely extended networks of cooperative labour, covering the globe in the bringing of the simplest item to the supermarket shelf.

So we come back to the question of whether (or rather how) the value of the product of a thousand workers each contributing an hour of their time may be worth more than a thousand hours of "uncomplicated" work by an individual.

The capitalist economist contends that capital itself adds value. This is as much nonsense today as it was when Karl Marx debunked this theory 150 years ago. But of course it is the kind of nonsense which is reflected in the capacity of capital to generate interest at the going rate. So our question has to be: how does capital generate new value?

When 10 people combine their labour intelligently and find that they can produce more by means of appropriate division of labour and cooperation, they thereby create a "surplus" over and above what they produced before. The things is, as has been pointed out already, it is only capital which is able to mobilise the labour of the entire community.

So, the surplus labour extracted is the difference between the labour time taken to produce the means of subsistence utilising the full power of the collective labour of the community, and the day's labour provided to the capitalist. This is exactly the same as Marx's definition. But here we have had to recognise that labour is in essence not measured by duration alone, but also by the level of social cooperation realised in the labour which has the effect of multiplying the value of final product produced by each individual participant as compared to the value of all the component services. The value of the component services are measured by wages. The value of the product by revenue, and the surplus value by the difference between wages and revenue, calculated of course, across the whole global process of production.

The rate of surplus value (the surplus labour time as a ratio to the necessary labour time) is a measure of the extent to which engagement of labour with the whole community enhances the productivity of the individual worker and the proportion which is claimed by capital for the service of delivering the labour of the community to the productive individual worker. Conceptually, it is easy to measure.

The Consciousness of Postmodern capitalism

The form of consciousness which arises from this situation is that the worker finds herself powerless and unproductive as an individual within a community which is capable of great feats. The representative and leader of the community, the power which can achieve all feats, is capital. No wonder that people feel that it is a privilege to be "given a job"!

Further, it is capital which manifests and represents the power of organised, social labour, and not only accumulates the profit derived from this combination, but seems to be the actual source of this power, which flows down from the lofty heights of the corporate world to control the lives of everyone at work. And capital is no longer something which manifests itself in the form of huge steel structures and machines but more likely in quite ephemeral forms. In so far as capital is the power to coordinate labour, it manifests itself as command and intelligence, as knowledge.

Blurring of lines

As has been pointed out at various points above, a lot of lines have been blurred by the development of postmodern capitalism. The line between worker and manager, manager and boss or contractor has been blurred; the line between commerce and production is gone. Capital cannot be identified with the manager's office, with production taking place on the factory floor. Capital has become almost impersonal with the entire workforce taking on the appearance of independent contractors. What is more, with the disappearance of old-age pensions, everyone has become an "investor", so the illusion is created that everyone is a worker and everyone is a capitalist. And the disappearance of the family and the state so far as the world of work is concerned, has drawn all goods and services of whatever kind into a single market.

The Grip of Capital

Suppose a group of workers want to escape the grip of capital and provide for their needs without commerce? Impossible. Not a step can be taken without materials, for which money is required. Millions of workers would have to combine their work before the need for "outside" products could be overcome without reverting to the stone age, in fact the entire world.

There has been a way of emphasising the aspect of time here: "dead labour" as opposed to "living labour", but this appears to be the case only if we focus on the material object as the carrier of human labour. This material thing (raw materials, foodstuffs, machinery, land, infrastructure) is not necessarily relevant, and increasingly less important. The thing is, how can we mobilise the cooperation of other workers. No matter that the labour of others is momentarily embodied in things which are the property of owners who require money in exchange for their use. We could bypass that if we could get the cooperation of those who produce the products in question. But this leads to an infinite regression.

The struggle of people to live according to their own freely made will comes up against the fact that the labour of the community at large, "out of range" so to speak, of the immediately-made consensus of producers, is put in the form of money. You and I can agree to cooperate, but when we need the assistance of the farmer and the baker, then we need money, and if not the farmer and the baker, someone else. Even when the state is the vehicle for achieving this, it must do so by "funding".

So this is a very fundamental fact of life in modern society: the cooperation of people that I can make direct and immediate contact with, is just that, cooperation of friends and colleagues; but the cooperation of the wider community which is needed to actually do anything at all, costs money. I can conceive of the voluntary cooperation of my friends without value, but the cooperation of the community at large, which I need if I am to live, has value.

If I need money I must provide my labour in the form of a "job". So I am bound to the community as a whole and the glue binding me is money. The community speaks to me with the voice of money. Am I useful to you fellow humans? Will you help me? "Yes" — money, "No" — starve. So he or she who has money to pay appears to speak for the whole community.

The payment of wages takes on the appearance of universal community approval, and like any such "appearance" based in really experienced social relations, it is a "very real" appearance. The community will show its approval by buying the product.

The Organisation of the Capitalist Class

"The main form of ruling-class organisation in Australia is the company; a fact so familiar, so mundane , that it is often overlooked.... Yet it is in companies that the daily life of capitalism occurs — power exercised, profit extracted, accumulation made possible. A serious analysis of a capitalist social order must be grounded in a knowledge of its chief organisations". [R W Connell, Ruling Class Ruling Culture, Chapter 4]

A social class is not a set into which individuals either belong or don't belong or half-belong, either by virtue of a definition as a property-owner or kinship or occupation; a social class is an having its existence in the organisation of social existence and the conception of those relations in social beliefs, norms and practices. Millions of people "own shares". So what!

The capitalist class is capital manifested in the form of a collective of people — collective in the broadest sense of the word — the requirements of capital accumulation expressed in the human will and its social elaboration. The dollar-share owner who is in actuality unable to influence the activity of the company of which she has a one-dollar share is not for that a capitalist; the managing director who earns a premium salary is a capitalist, but only to the extent and so long as she works at enlarging capital.

I agree with Connell as quoted above, that the company is the basic unit of organisation of the capitalist class, and the relation of the company to individual people is typical of the relation of individuals to the capitalist class generally. Individual capitlaists have interests in a number of different companies, companies own shares in each other, punters own shares but have no influence, kinship relations linger on in ownership patterns and influence, private ownership overlaps with public ownership, companies battle each other, form alliances, share illusions and broadly hang together in what we call the capitalist class.

The various arms of the state are a branch of activity concerned both with private interest and community responsibility, arenas of struggle between sections of the class and against rival classes, but by no stretch of the imagination the actual leadership of the capitalist class. The capitalist class is first and above all a "non-political" class, with its roots and its trunk firmly planted in bourgeois society. The state has grown out of bourgeois society, separated itself from it and is becoming less and less significant in the dynamics of bourgeois society. The essence of the organisation of the capitalist class is the company — the smallest, indivisible unit of capitalism, the "molecule" of capitalist chemistry.

Consequently, the changes taking place in the company are of fundamental importance in understanding the development of the whole social system. There is no short-cut here past the empirical study of contemporary develops in companies, especially the largest and most powerful, and this author is not well-equipped for that study. I have made certain observation about the development of companies and their internal organisation, which are generally based on casual observation. There is however a need for thorough empirical study of the development corporatisation, contracting-out, out-sourcing, devolution of management responsibility to operatives, casual and contract employment and so on.

Further Work

The above sketch points to the need for some empirical work exploring the human relationships in a range of types of productive organisations. It would be good to be able to study: a large private hospital, Macdonald's, Coca Cola (which has moved from manufacture to distribution), the rag-trade firms depending on subcontracting and home-work, a large transnational hi-tech manufacturing company and a bank. At the same time the flow of money needs to be traced.

On the other hand, I want to explore the syllogisms identified above as the possible source of theoretical clarity in relation to the key concepts. These syllogisms can be expressed as: customer — service provider — contract employee, or alternatively it is a question of exploring the relation between purchase and command, between production and commerce.


Interpenetration of Labour and Capital

The tendency of capital is to reduce all employees to independent contractors. That is the logic of capital. However, if we assume this, then we would miss the very thing which we are interested in! Labour is an organised body, and whether the labourer confronts capital as an isolated atom with labour-service for sale, or as an organised mass with rights and standards which place limits on the capacity of capital to impose its will on people, is a question of the level of development of the voluntary organisation of labour. An enterprise is an organisation manifesting the action of capital, but it is also a voluntary organisation, inasmuch as people are not slaves, but free labourers, and however much they are constrained to work in order to live, they remain human beings and engage in voluntary organisation within the enterprise.

Individuality and Dependence

"Relations of personal dependence are the first social forms in which human productive capacity develops only to a slight extent and at isolated points. Personal independence founded on objective dependence is the second great form, in which a system of general social metabolism, of universal relations, of all-round needs and universal capacities is formed for the first time. Free individuality, based on the universal development of individuals and on their subordination of their communal, social productivity as their social wealth, is the third stage" — Grundrisse p 158

Value added by Association

Analogy: a labourer builds a house in X-ville and is paid a fair rate. Over the years, different labourers build houses around X-ville and the house is no longer an isolated stack of bricks but an inner-city residence, worth much more than the cost of building it, reflected in the increasing value of land. The value of what is produced by the whole lot of labourers together vastly exceeds the sum of values of what is produced by each separately. Why else do people cluster together in communities except for the fact that what they produce together meets their needs more effectively than what they produce singly? Division of labour? Well yes, but why divide labour in the first place, except for the fact that the total product is thereby increased? And what binds the community together? — money.

Social Production of Labour power

The socialisation of domestic labour means that the value of wages (the cost of production of labour power) has been reduced but more payment of wages is required because the production of labour power requires the purchase of services which were formerly provided through domestic service without pay. The additional wage mostly comes via multiple wage-earners in a given household, with increased participation rates.

Scale of Capital and Rate of Profit

The larger the unit of capital, the larger the rate of return.

Two aspects: (1) empirically this appears to be the case, and no wonder, because large capital is able to move around to maximise its rate of profit, and (2) the larger the scope of collective labour employed, the higher the rate of productivity.

Level Playing Field?

A huge multinational corporation competes providing the same service as a small firm. Both sell the service at the same price. The large capital makes a profit due to the fact that it is able to mobilise a larger and more complex division of labour, which the small capital cannot emulate.

At the other end of the scale, a person might make themselves a meal or eat out, and broadly speaking, we could suppose that the two have equal value. The restaurant makes their profit on the basis of a superior division of labour.

When a large corporation is broken up into a network of contractors engaged by a capital, then each component part has an inferior division of labour and it can hawk itself around as much as it likes, but it only command a price consonant with the total labour it is able to mobilise.


1. "Service Sector" is a category of bourgeois economics which may lead to confusion. Where a particular act of labour is a service or manufacture is a matter determined entirely social relations within which the labour is performed, not at all by the nature of the labour itself. My understanding of "service sector" is that it includes the retail industry where workers are essentially supporting the exchange of commodities rather than building new ones, even though we will see that many supposed services are more properly deemed as manufacture such as in the case of hamburger stalls which manufacture the product behind the counter while it is being purchased, personal services, where the labourers employed in the sector "do things for people", all manner of labour-hire and consultancy be it writing programs for other people (rather than producing IT products for sale), recruiting or organising someone else's staff or doing a part of their work on contract and so on, scientific research where it is carried out on commission rather than with the aim of producing patented knowledge-products for sale, which is manufacture even it would be more properly called "brainfacture" since it involves mental rather than manual work, and the entire finance sector where it is in the very essence of the work carried out that it is a service and not a manufacture.