A Critical Examination of Socialism. W. H. Mallock
the means by which this faculty of direction is exercised.
In order to understand this, we must turn our attention again to capital, as something distinct and detached from the human efforts that have produced it; and we shall find that the conception of it which dominated the thought of Marx, and that which dominates the thought of the orthodox school of economists, either excludes altogether, or fails to reveal the nature of, that particular force and function of it which, in the modern world, are fundamental.
Capital is divided traditionally into two kinds, technically called "fixed" and "circulating." By fixed capital, which is what Marx had mainly in view, is meant machinery, and the works and structures connected with it; and it is called "fixed" on account of its comparative permanence. By circulating capital is meant, as Adam Smith puts it, any stock of those consumable commodities which, produced by the aid of machinery, the merchant or the store-keeper buys in order to sell them at a profit; and it is called "circulating" because the commodities which are sold to-day are replaced by new ones of an equivalent kind to-morrow.
Now, as to fixed capital, or the endlessly elaborated machinery of the modern world, we have seen already that this is, in its distinctive features, not, as Marx declared it to be, a crystallisation of labour, but a crystallisation of the ability by which labour has been directed; but this revised explanation tells us nothing of the means by which the direction is accomplished. Still less is any light thrown on the question by the nature of circulating capital, as Adam Smith understands it.
The kind of capital which alone concerns us here is a kind which resembles circulating capital in respect of its material form, and is often indeed in this respect identical with it; but it differs from circulating capital in respect of the use made of it. Such capital we may call wage-capital. Wage-capital, although in practice it disguises itself under the form of money, is essentially a stock of goods which are the daily necessaries of life, but which, instead of being sold to the public, like the goods of the store-keeper, at a profit, are distributed by their possessor among a special group of labourers on conditions. The first of these is naturally that the labourers do work of some sort. The second condition, and the one that concerns us here, is that, besides doing work of some sort, each labourer shall do the work which the distributer of the goods prescribes to him.
Here we have before us the means by which, in the modern world, the ability of the few directs the labour of the many; and, in proportion to the quality and intensity of the directive powers that are exercised, adds to the value of the results which this labour would have produced otherwise. Thus in wage-capital we have the capital of the modern world in what dynamically is its primary and parent form—a kind of capital which improved machinery is always tending to augment, but of whose use the machinery itself, its renewal, and its continued improvement, are the consequences.
That such is the case might be illustrated by any number of familiar examples. A man invents a new machine having some useful purpose—let us say the production of some new kind of manure, which will double the fertility of every field in the country. In order to put this machine on the market, and make it a fact instead of a mere conception, the first thing necessary is, as every human being knows, that the inventor shall possess, or acquire, the control of capital. And what is the next step? When the capital is provided, how will it first be used? It will be used in the form of wages, or articles of daily consumption, which will be distributed among a certain number of mechanics and other labourers, on condition that they set about fashioning, in certain prescribed groups, so much metal into so many prescribed shapes—some of them shaping it into wheels, some into knives and rollers, some into sieves, rods, cranks, cams, and eccentrics, in accordance with patterns which have never been followed previously; and of all these individual operations the new machine, as a practical implement, is the result. The machine is new, and it is an addition to the wealth-producing powers of the world, not because it embodies so much labour, but because it embodies so much labour directed in a new way; and it is only by means of the conditions which the possession of wage-capital enables the inventor or his partners to impose upon every one of the labourers that the machine, as a practical implement, comes into existence at all.
Hence we see that Marx was at once right and wrong when he said that modern capitalism is, in its essence, monopoly. It is monopoly; but it is not primarily, as Marx thought, a passive monopoly of improved instruments of production. It is primarily a monopoly of products which are essential to the life of the labourer; and it is a monopoly of these, not in the invidious sense that the monopolists retain them for their own personal consumption, as they do in the case of rare wines and fabrics, which can, from the nature of the case, be enjoyed by a few only. It is a monopoly of them in the sense that the monopolists have such a control over their distribution as enables them to control the purely technical actions of those persons who ultimately own and consume the whole of them. [2]
Modern capital, then, I repeat, is primarily wage-capital, such capital as modern machinery being the direct result of its application; and wage-capital is productive, not in virtue of any quality inherent in itself, but merely because as a fact, under the modern system, it constitutes the reins by which the exceptional ability of a few guides the labour, skilled or unskilled, of the many. It is the means by which the commonest labourer, who hardly knows the rule of three, is made to work as though he were master of the abstruest branches of mathematics; by which the artisan who only has a smattering—if he has as much as that—of mechanics, metallurgy, chemistry, is made to work as though all the sciences had been assimilated by his single brain.
Let any one consider, for example, one of the great steel bridges which now throw their single spans over waters such as the Firth of Forth. These structures are crystallised labour, doubtless, but they are, in their distinctive features, not crystallised labour as such. They are crystallised mechanics, crystallised chemistry, crystallised mathematics—in short, crystallised intellect, knowledge, imagination, and executive capacity, of kinds which hardly exist in a dozen minds out of a million; and labour conduces to the production of such astonishing structures only because it submits itself to the guidance of these intellectual leaders. And the same is the case with modern production generally. Though labour is essential to the production of wealth even in the smallest quantities, the distinguishing productivity of industry in the modern world depends not on the labour, but on the ability with which the labour is directed; and in the modern world the primary function of capital is that of providing ability with its necessary instrument of direction.
No unprejudiced person, who is capable of coherent thought, can, when the matter is thus plainly stated, possibly deny this. That it cannot be denied will be shown in the two following chapters by recent admissions on the part of socialists themselves, the more thoughtful of whom have now virtually abandoned the earlier theoretical framework of socialism altogether, and are trying to substitute a new one, with which we will deal later, and which will indeed prove the main subject of our inquiry.
FOOTNOTES:
[1] When I insisted on this distinction between "labour" and "ability" in America, innumerable critics met me with two objections. One of these, as stated by a writer who confessed himself otherwise in entire agreement with me, was this: "It is impossible, as Mr. Mallock attempts to do, to draw a hard-and-fast line between mental effort and muscular." No such attempt is made. As I pointed out in one of my speeches, many kinds of "labour" (e.g. that of the great painter) exhibit higher mentality than do many kinds of ability. Further, I pointed out that, in a technical sense, the same effort may be either an effort of labour or ability, according to its application. Thus, if a singer sings to an audience, his effort is technically "labour," because it ends with the single task; but if he sings so as to produce a gramophone record, his effort is an act of "ability," for he influences the products of other men, by whom the records are multiplied. The second objection was expressed by one of my critics thus: "I say that all productive effort is labour. … I dare you to tell any one of these genii that