Karl Marx

Wage Labour and Capital

Delivered: December 1847
Source: Wage Labour and Capital, the original 1891 pamphlet
Edited/Translated: Frederick Engels
Transcription/Markup: Zodiac and Brian Basgen

Table of Contents:

01, What are wages?
02, By what is the price of a commodity determined?
03, By what are wages determined?
04, The nature and growth of capital
05, Relation of wage-labor to capital
06, The general law that determines the rise and fall of wages and profit
07, The interests of capital and wage-labor are diametrically opposed
08, Effect of capitalist competition on the capitalist class, middle class and working class

Introduction to Karl Marx's Wage Labor and Capital

by Frederick Engels





My alterations centre about one point. According to the original reading, the worker sells his labor for wages, which he receives from the capitalist; according to the present text, he sells his labor-power. And for this change, I must render an explanation: to the workers, in order that they may understand that we are not quibbling or word-juggling, but are dealing here with one of the most important points in the whole range of political economy; to the bourgeois, in order that they may convince themselves how greatly the uneducated workers, who can be easily made to grasp the most difficult economic analyses, excel our supercilious "cultured" folk, for whom such ticklish problems remain insoluble their whole life long.






















London, April 30, 1891.




(Karl Marx, Capital, Vol.I, p.93f.)



It was necessary, beyond everything else, to follow the development of the class struggle in the history of our own day, and to prove empirically, by the actual and daily newly created historical material, that with the subjugation of the working class, accomplished in the days of February and March, 1848, the opponents of that class — the bourgeois republicans in France, and the bourgeois and peasant classes who were fighting feudal absolutism throughout the whole continent of Europe — were simultaneously conquered; that the victory of the "moderate republic" in France sounded at the same time the fall of the nations which had responded to the February revolution with heroic wars of independence; and finally that, by the victory over the revolutionary workingmen, Europe fell back into its old double slavery, into the English-Russian slavery. The June conflict in Paris, the fall of Vienna, the tragi-comedy in Berlin in November 1848, the desperate efforts of Poland, Italy, and Hungary, the starvation of Ireland into submission — these were the chief events in which the European class struggle between the bourgeoisie and the working class was summed up, and from which we proved that every revolutionary uprising, however remote from the class struggle its object might appear, must of necessity fail until the revolutionary working class shall have conquered; — that every social reform must remain a Utopia until the proletarian revolution and the feudalistic counter-revolution have been pitted against each other in a world-wide war . In our presentation, as in reality, Belgium and Switzerland were tragicomic caricaturish genre pictures in the great historic tableau; the one the model State of the bourgeois monarchy, the other the model State of the bourgeois republic; both of them, States that flatter themselves to be just as free from the class struggle as from the European revolution.

But now, after our readers have seen the class struggle of the year 1848 develop into colossal political proportions, it is time to examine more closely the economic conditions themselves upon which is founded the existence of the capitalist class and its class rule, as well as the slavery of the workers.

We shall present the subject in three great divisions:

The Relation of Wage-Labor to Capital, the Slavery of the Worker, the Rule of the Capitalist.

The Inevitable Ruin of the Middle Classes [petty-bourgeois] and the so-called Commons [peasants] under the present system.

The Commercial Subjugation and Exploitation of the Bourgeois classes of the various European nations by the Despot of the World Market — England.

We shall seek to portray this as simply and popularly as possible, and shall not presuppose a knowledge of even the most elementary notions of political economy. We wish to be understood by the workers. And, moreover, there prevails in Germany the most remarkable ignorance and confusion of ideas in regard to the simplest economic relations, from the patented defenders of existing conditions, down to the socialist wonder-workers and the unrecognized political geniuses, in which divided Germany is even richer than in duodecimo princelings. We therefore proceed to the consideration of the first problem.

1. What are Wages? How are they Determined?

If several workmen were to be asked: "How much wages do you get?", one would reply, "I get two shillings a day", and so on. According to the different branches of industry in which they are employed, they would mention different sums of money that they receive from their respective employers for the completion of a certain task; for example, for weaving a yard of linen, or for setting a page of type. Despite the variety of their statements, they would all agree upon one point: that wages are the amount of money which the capitalist pays for a certain period of work or for a certain amount of work.

Consequently, it appears that the capitalist buys their labour with money, and that for money they sell him their labour. But this is merely an illusion. What they actually sell to the capitalist for money is their labour-power. This labour-power the capitalist buys for a day, a week, a month, etc. And after he has bought it, he uses it up by letting the worker labour during the stipulated time. With the same amount of money with which the capitalist has bought their labour-power (for example, with two shillings) he could have bought a certain amount of sugar or of any other commodity. The two shillings with which he bought 20 pounds of sugar is the price of the 20 pounds of sugar. The two shillings with which he bought 12 hours' use of labour-power, is the price of 12 hours' labour. Labour-power, then, is a commodity, no more, no less so than is the sugar. The first is measured by the clock, the other by the scales.

Their commodity, labour-power, the workers exchange for the commodity of the capitalist, for money, and, moreover, this exchange takes place at a certain ratio. So much money for so long a use of labour-power. For 12 hours' weaving, two shillings. And these two shillings, do they not represent all the other commodities which I can buy for two shillings? Therefore, actually, the worker has exchanged his commodity, labour-power, for commodities of all kinds, and, moreover, at a certain ratio. By giving him two shillings, the capitalist has given him so much meat, so much clothing, so much wood, light, etc., in exchange for his day's work. The two shillings therefore express the relation in which labour-power is exchanged for other commodities, the exchange-value of labour-power.

The exchange value of a commodity estimated in money is called its price. Wages therefore are only a special name for the price of labour-power, and are usually called the price of labour; it is the special name for the price of this peculiar commodity, which has no other repository than human flesh and blood.

Let us take any worker; for example, a weaver. The capitalist supplies him with the loom and yarn. The weaver applies himself to work, and the yarn is turned into cloth. The capitalist takes possession of the cloth and sells it for 20 shillings, for example. Now are the wages of the weaver a share of the cloth, of the 20 shillings, of the product of the work? By no means. Long before the cloth is sold, perhaps long before it is fully woven, the weaver has received his wages. The capitalist, then, does not pay his wages out of the money which he will obtain from the cloth, but out of money already on hand. Just as little as loom and yarn are the product of the weaver to whom they are supplied by the employer, just so little are the commodities which he receives in exchange for his commodity — labour-power — his product. It is possible that the employer found no purchasers at all for the cloth. It is possible that he did not get even the amount of the wages by its sale. It is possible that he sells it very profitably in proportion to the weaver's wages. But all that does not concern the weaver. With a part of his existing wealth, of his capital, the capitalist buys the labour-power of the weaver in exactly the same manner as, with another part of his wealth, he has bought the raw material — the yarn — and the instrument of labour — the loom. After he has made these purchases, and among them belongs the labour-power necessary to the production of the cloth he produces only with raw materials and instruments of labour belonging to him. For our good weaver, too, is one of the instruments of labour, and being in this respect on a par with the loom, he has no more share in the product (the cloth), or in the price of the product, than the loom itself has.





Before entering more closely upon the relation of capital to wage-labour, we shall present briefly the most general conditions which come into consideration in the determination of wages.

Wages, as we have seen, are the price of a certain commodity, labour-power. Wages, therefore, are determined by the same laws that determine the price of every other commodity. The question then is, How is the price of a commodity determined?

2. By what is the price of a commodity determined?




Finally, there is competition between the buyers and the sellers: these wish to purchase as cheaply as possible, those to sell as dearly as possible. The result of this competition between buyers and sellers will depend upon the relations between the two above-mentioned camps of competitors — i.e., upon whether the competition in the army of sellers is stronger. Industry leads two great armies into the field against each other, and each of these again is engaged in a battle among its own troops in its own ranks. The army among whose troops there is less fighting carries of the victory over the opposing host.














3. By what are wages determined?




Therefore, the shorter the time required for training up to a particular sort of work, the smaller is the cost of production of the worker, the lower is the price of his labor-power, his wages. In those branches of industry in which hardly any period of apprenticeship is necessary and the mere bodily existence of the worker is sufficient, the cost of his production is limited almost exclusively to the commodities necessary for keeping him in working condition. The price of his work will therefore be determined by the price of the necessary means of subsistence.

Here, however, there enters another consideration. The manufacturer who calculates his cost of production and, in accordance with it, the price of the product, takes into account the wear and tear of the instruments of labor. If a machine costs him, for example, 1,000 shillings, and this machine is used up in 10 years, he adds 100 shillings annually to the price of the commodities, in order to be able after 10 years to replace the worn-out machine with a new one. In the same manner, the cost of production of simple labor-power must include the cost of propagation, by means of which the race of workers is enabled to multiply itself, and to replace worn-out workers with new ones. The wear and tear of the worker, therefore, is calculated in the same manner as the wear and tear of the machine.

Thus, the cost of production of simple labor-power amounts to the cost of the existence and propagation of the worker. The price of this cost of existence and propagation constitutes wages. The wages thus determined are called the minimum of wages. This minimum wage, like the determination of the price of commodities in general by cost of production, does not hold good for the single individual, but only for the race. Individual workers, indeed, millions of workers, do not receive enough to be able to exist and to propagate themselves; but the wages of the whole working class adjust themselves, within the limits of their fluctuations, to this minimum.

Now that we have come to an understanding in regard to the most general laws which govern wages, as well as the price of every other commodity, we can examine our subject more particularly.

4. The Nature and Growth of Capital

Capital consists of raw materials, instruments of labor, and means of subsistence of all kinds, which are employed in producing new raw materials, new instruments, and new means of subsistence. All these components of capital are created by labor, products of labor, accumulated labor. Accumulated labor that serves as a means to new production is capital.

So says the economists.




These social relations between the producers, and the conditions under which they exchange their activities and share in the total act of production, will naturally vary according to the character of the means of production. With the discover of a new instrument of warfare, the firearm, the whole internal organization of the army was necessarily altered, the relations within which individuals compose an army and can work as an army were transformed, and the relation of different armies to another was likewise changed.

We thus see that the social relations within which individuals produce, the social relations of production, are altered, transformed, with the change and development of the material means of production, of the forces of production. The relations of production in their totality constitute what is called the social relations, society, and, moreover, a society at a definite stage of historical development, a society with peculiar, distinctive characteristics. Ancient society, feudal society, bourgeois (or capitalist) society, are such totalities of relations of production, each of which denotes a particular stage of development in the history of mankind.

Capital also is a social relation of production. It is a bourgeois relation of production, a relation of production of bourgeois society. The means of subsistence, the instruments of labor, the raw materials, of which capital consists — have they not been produced and accumulated under given social conditions, within definite special relations? Are they not employed for new production, under given special conditions, within definite social relations? And does not just the definite social character stamp the products which serve for new production as capital?

Capital consists not only of means of subsistence, instruments of labor, and raw materials, not only as material products; it consists just as much of exchange values. All products of which it consists are commodities. Capital, consequently, is not only a sum of material products, it is a sum of commodities, of exchange values, of social magnitudes. Capital remains the same whether we put cotton in the place of wool, rice in the place of wheat, steamships in the place of railroads, provided only that the cotton, the rice, the steamships — the body of capital — have the same exchange value, the same price, as the wool, the wheat, the railroads, in which it was previously embodied. The bodily form of capital may transform itself continually, while capital does not suffer the least alteration.

But though every capital is a sum of commodities — i.e., of exchange values — it does not follow that every sum of commodities, of exchange values, is capital.

Every sum of exchange values is an exchange value. Each particular exchange value is a sum of exchange values. For example: a house worth 1,000 pounds is an exchange value of 1,000 pounds: a piece of paper worth one penny is a sum of exchange values of 100 1/100ths of a penny. Products which are exchangeable for others are commodities. The definite proportion in which they are exchangeable forms their exchange value, or, expressed in money, their price. The quantity of these products can have no effect on their character as commodities, as representing an exchange value , as having a certain price. Whether a tree be large or small, it remains a tree. Whether we exchange iron in pennyweights or in hundredweights, for other products, does this alter its character: its being a commodity, or exchange value? According to the quantity, it is a commodity of greater or of lesser value, of higher or of lower price.

How then does a sum of commodities, of exchange values, become capital?

Thereby, that as an independent social power — i.e., as the power of a part of society — it preserves itself and multiplies by exchange with direct, living labor-power.

The existence of a class which possess nothing but the ability to work is a necessary presupposition of capital.

It is only the dominion of past, accumulated, materialized labor over immediate living labor that stamps the accumulated labor with the character of capital.

Capital does not consist in the fact that accumulated labor serves living labor as a means for new production. It consists in the fact that living labor serves accumulated labor as the means of preserving and multiplying its exchange value.

5. Relation of Wage-Labour to Capital

What is it that takes place in the exchange between the capitalist and the wage-labor?

The laborer receives means of subsistence in exchange for his labor-power; the capitalist receives, in exchange for his means of subsistence, labor, the productive activity of the laborer, the creative force by which the worker not only replaces what he consumes, but also gives to the accumulated labor a greater value than it previously possessed. The laborer gets from the capitalist a portion of the existing means of subsistence. For what purpose do these means of subsistence serve him? For immediate consumption. But as soon as I consume means of subsistence, they are irrevocably lost to me, unless I employ the time during which these means sustain my life in producing new means of subsistence, in creating by my labor new values in place of the values lost in consumption. But it is just this noble reproductive power that the laborer surrenders to the capitalist in exchange for means of subsistence received. Consequently, he has lost it for himself.

Let us take an example. For one shilling a laborer works all day long in the fields of a farmer, to whom he thus secures a return of two shillings. The farmer not only receives the replaced value which he has given to the day laborer, he has doubled it. Therefore, he has consumed the one shilling that he gave to the day laborer in a fruitful, productive manner. For the one shilling he has bought the labor-power of the day-laborer, which creates products of the soil of twice the value, and out of one shilling makes two. The day-laborer, on the contrary, receives in the place of his productive force, whose results he has just surrendered to the farmer, one shilling, which he exchanges for means of subsistence, which he consumes more or less quickly. The one shilling has therefore been consumed in a double manner — reproductively for the capitalist, for it has been exchanged for labor-power, which brought forth two shillings; unproductively for the worker, for it has been exchanged for means of subsistence which are lost for ever, and whose value he can obtain again only by repeating the same exchange with the farmer. Capital therefore presupposes wage-labor; wage-labor presupposes capital. They condition each other; each brings the other into existence.




But what is growth of productive capital? Growth of the power of accumulated labor over living labor; growth of the rule of the bourgeoisie over the working class. When wage-labor produces the alien wealth dominating it, the power hostile to it, capital, there flow back to it its means of employment — i.e., its means of subsistence, under the condition that it again become a part of capital, that is become again the lever whereby capital is to be forced into an accelerated expansive movement.

To say that the interests of capital and the interests of the workers are identical, signifies only this: that capital and wage-labor are two sides of one and the same relation. The one conditions the other in the same way that the usurer and the borrower condition each other.

As long as the wage-laborer remains a wage-laborer, his lost is dependent upon capital. That is what the boasted community of interests between worker and capitalists amounts to.

If capital grows, the mass of wage-labor grows, the number of wage-workers increases; in a word, the sway of capital extends over a greater mass of individuals.

Let us suppose the most favorable case: if productive capital grows, the demand for labor grows. It therefore increases the price of labor-power, wages.



But wages are not at all determined merely by the sum of commodities for which they may be exchanged. Other factors enter into the problem. What the workers directly receive for their labor-power is a certain sum of money. Are wages determined merely by this money price?


Let us take another case. In the winter of 1847, in consequence of bad harvest, the most indispensable means of subsistence — grains, meat, butter, cheese, etc. — rose greatly in price. Let us suppose that the workers still received the same sum of money for their labor-power as before. Did not their wages fall? To be sure. For the same money they received in exchange less bread, meat, etc. Their wages fell, not because the value of silver was less, but because the value of the means of subsistence had increased.


The money price of labor-power, the nominal wages, do not therefore coincide with the actual or real wages — i.e., with the amount of commodities which are actually given in exchange for the wages. If then we speak of a rise or fall of wages, we have to keep in mind not only the money price of labor-power, the nominal wages, but also the real wages.

But neither the nominal wages — i.e., the amount of money for which the laborer sells himself to the capitalist — nor the real wages — i.e., the amount of commodities which he can buy for this money — exhausts the relations which are comprehended in the term wages.


Real wages express the price of labor-power in relation to the price of commodities; relative wages, on the other hand, express the share of immediate labor in the value newly created by it, in relation to the share of it which falls to accumulated labor, to capital.

6. The General Law that Determines the Rise and Fall of Wages and Profits

We have said: "Wages are not a share of the worker in the commodities produced by him. Wages are that part of already existing commodities with which the capitalist buys a certain amount of productive labor-power." But the capitalist must replace these wages out of the price for which he sells the product made by the worker; he must so replace it that, as a rule, there remains to him a surplus above the cost of production expended by him, that is, he must get a profit.



Second, the replacement of the wages advanced; and

Third, the surplus leftover — i.e., the profit of the capitalist.

While the first part merely replaces previously existing values, it is evident that the replacement of the wages and the surplus (the profit of capital) are as a whole taken out of the new value, which is produced by the labor of the worker and added to the raw materials. And in this sense we can view wages as well as profit, for the purpose of comparing them with each other, as shares in the product of the worker.

Real wages may remain the same, they may even rise, nevertheless the relative wages may fall. Let us suppose, for instance, that all means of subsistence have fallen 2/3rds in price, while the day's wages have fallen but 1/3rd — for example, from three to two shillings. Although the worker can now get a greater amount of commodities with these two shillings than he formerly did with three shillings, yet his wages have decreased in proportion to the gain of the capitalist. The profit of the capitalist — the manufacturer's for instance — has increased one shilling, which means that for a smaller amount of exchange values, which he pays to the worker, the latter must produce a greater amount of exchange values than before. The share of capitals in proportion to the share of labor has risen. The distribution of social wealth between capital and labor has become still more unequal. The capitalist commands a greater amount of labor with the same capital. The power of the capitalist class over the working class has grown, the social position of the worker has become worse, has been forced down still another degree below that of the capitalist.

What, then is the general law that determines the rise and fall of wages and profit in their reciprocal relation?

They stand in inverse proportion to each other. The share of (profit) increases in the same proportion in which the share of labor (wages) falls, and vice versa. Profit rises in the same degree in which wages fall; it falls in the same degree in which wages rise.

It might perhaps be argued that the capitalist class can gain by an advantageous exchange of his products with other capitalists, by a rise in the demand for his commodities, whether in consequence of the opening up of new markets, or in consequence of temporarily increased demands in the old market, and so on; that the profit of the capitalist, therefore, may be multiplied by taking advantage of other capitalists, independently of the rise and fall of wages, of the exchange value of labor-power; or that the profit of the capitalist may also rise through improvements in the instruments of labor, new applications of the forces of nature, and so on.

But in the first place it must be admitted that the result remains the same, although brought about in an opposite manner. Profit, indeed, has not risen because wages have fallen, but wages have fallen because profit has risen. With the same amount of another man's labor the capitalist has bought a larger amount of exchange values without having paid more for the labor on that account — i.e., the work is paid for less in proportion to the net gain which it yields to the capitalist.

In the second place, it must be borne in mind that, despite the fluctuations in the prices of commodities, the average price of every commodity, the proportion in which it exchanges for other commodities, is determined by its cost of production. The acts of overreaching and taking advantage of one another within the capitalist ranks necessarily equalize themselves. The improvements of machinery, the new applications of the forces of nature in the service of production, make it possible to produce in a given period of time, with the same amount of labor and capital, a larger amount of products, but in no wise a larger amount of exchange values. If by the use of the spinning-machine I can furnish twice as much yarn in an hour as before its invention — for instance, 100 pounds instead of 50 pounds -- in the long run I receive back, in exchange for this 100 pounds no more commodities than I did before for 50; because the cost of production has fallen by 1/2, or because I can furnish double the product at the same cost.

Finally, in whatsoever proportion the capitalist class, whether of one country or of the entire world-market, distribute the net revenue of production among themselves, the total amount of this net revenue always consists exclusively of the amount by which accumulated labor has been increased from the proceeds of direct labor. This whole amount, therefore, grows in the same proportion in which labor augments capital — i.e., in the same proportion in which profit rises as compared with wages.

7. The Interests of Capital and Wage-Labour are diametrically opposed. Effect of growth of productive Capital on Wages

We thus see that, even if we keep ourselves within the relation of capital and wage-labor, the interests of capitals and the interests of wage-labor are diameterically opposed to each other.

A rapid growth of capital is synonymous with a rapid growth of profits. Profits can grow rapidly only when the price of labor — the relative wages — decrease just as rapidly. Relative wages may fall, although real wages rise simultaneously with nominal wages, with the money value of labor, provided only that the real wage does not rise in the same proportion as the profit. If, for instance, in good business years wages rise 5 per cent, while profits rise 30 per cent, the proportional, the relative wage has not increased, but decreased.

If, therefore, the income of the worker increased with the rapid growth of capital, there is at the same time a widening of the social chasm that divides the worker from the capitalist, and increase in the power of capital over labor, a greater dependence of labor upon capital.

To say that "the worker has an interest in the rapid growth of capital", means only this: that the more speedily the worker augments the wealth of the capitalist, the larger will be the crumbs which fall to him, the greater will be the number of workers than can be called into existence, the more can the mass of slaves dependent upon capital be increased.



Finally, to say that "the most favorable condition for wage-labor is the fastest possible growth of productive capital", is the same as to say: the quicker the working class multiplies and augments the power inimical to it — the wealth of another which lords over that class — the more favorable will be the conditions under which it will be permitted to toil anew at the multiplication of bourgeois wealth, at the enlargement of the power of capital, content thus to forge for itself the golden chains by which the bourgeoisie drags it in its train.

Growth of productive capital and rise of wages, are they really so indissolubly united as the bourgeois economists maintain? We must not believe their mere words. We dare not believe them even when they claim that the fatter capital is the more will its slave be pampered. The bourgeoisie is too much enlightened, it keeps its accounts much too carefully, to share the prejudices of the feudal lord, who makes an ostentatious display of the magnificence of his retinue. The conditions of existence of the bourgeoisie compel it to attend carefully to its bookkeeping. We must therefore examine more closely into the following question:

In what manner does the growth of productive capital affect wages?

If as a whole, the productive capital of bourgeois society grows, there takes place a more many-sided accumulation of labor. The individual capitals increase in number and in magnitude. The multiplications of individual capitals increases the competition among capitalists. The increasing magnitude of increasing capitals provides the means of leading more powerful armies of workers with more gigantic instruments of war upon the industrial battlefield.

The one capitalist can drive the other from the field and carry off his capital only by selling more cheaply. In order to sell more cheaply without ruining himself, he must produce more cheaply — i.e., increase the productive forces of labor as much as possible.

But the productive forces of labor is increased above all by a greater division of labor and by a more general introduction and constant improvement of machinery. The larger the army of workers among whom the labor is subdivided, the more gigantic the scale upon which machinery is introduced, the more in proportion does the cost of production decrease, the more fruitful is the labor. And so there arises among the capitalists a universal rivalry for the increase of the division of labor and of machinery and for their exploitation upon the greatest possible scale.

If, now, by a greater division of labor, by the application and improvement of new machines, by a more advantageous exploitation of the forces of nature on a larger scale, a capitalist has found the means of producing with the same amount of labor (whether it be direct or accumulated labor) a larger amount of products of commodities than his competitors — if, for instance, he can produce a whole yard of linen in the same labor-time in which his competitors weave half-a-yard — how will this capitalist act?

He could keep on selling half-a-yard of linen at old market price; but this would not have the effect of driving his opponents from the field and enlarging his own market. But his need of a market has increased in the same measure in which his productive power has extended. The more powerful and costly means of production that he has called into existence enable him, it is true, to sell his wares more cheaply, but they compel him at the same time to sell more wares, to get control of a very much greater market for his commodities; consequently, this capitalist will sell his half-yard of linen more cheaply than his competitors.

But the capitalist will not sell the whole yard so cheaply as his competitors sell the half-yard, although the production of the whole yard costs him no more than does that of the half-yard to the others. Otherwise, he would make no extra profit, and would get back in exchange only the cost of production. He might obtain a greater income from having set in motion a larger capital, but not from having made a greater profit on his capital than the others. Moreover, he attains the object he is aiming at if he prices his goods only a small percentage lower than his competitors. He drives them off the field, he wrests from them at least part of their market, by underselling them.

And finally, let us remember that the current price always stands either above or below the cost of production, according as the sale of a commodity takes place in the favorable or unfavorable period of the industry. According as the market price of the yard of linen stands above or below its former cost of production, will the percentage vary at which the capitalist who has made use of the new and more faithful means of production sell above his real cost of production.

But the privilege of our capitalist is not of long duration. Other competing capitalists introduce the same machines, the same division of labor, and introduce them upon the same or even upon a greater scale. And finally this introduction becomes so universal that the price of the linen is lowered not only below its old, but even below its new cost of production.

The capitalists therefore find themselves, in their mutual relations, in the same situation in which they were before the introduction of the new means of production; and if they are by these means enabled to offer double the product at the old price, they are now forced to furnish double the product for less than the old price. Having arrived at the new point, the new cost of production, the battle for supremacy in the market has to be fought out anew. Given more division of labor and more machinery, and there results a greater scale upon which division of labor and machinery are exploited. And competition again brings the same reaction against this result.

8. Effect of Capitalist Competition on the Capitalist Class, the Middle Class and the Working Class

We thus see how the method of production and the means of production are constantly enlarged, revolutionized, how division of labor necessarily draws after it greater division of labor, the employment of machinery greater employment of machinery, work upon a large scale work upon a still greater scale. This is the law that continually throws capitalist production out of its old ruts and compels capital to strain ever more the productive forces of labor for the very reason that it has already strained them — the law that grants it no respite, and constantly shouts in its ear: March! march! This is no other law than that which, within the periodical fluctuations of commerce, necessarily adjusts the price of a commodity to its cost of production.


Whatever be the power of the means of production which are employed, competition seeks to rob capital of the golden fruits of this power by reducing the price of commodities to the cost of production; in the same measure in which production is cheapened - i.e., in the same measure in which more can be produced with the same amount of labor — it compels by a law which is irresistible a still greater cheapening of production, the sale of ever greater masses of product for smaller prices. Thus the capitalist will have gained nothing more by his efforts than the obligation to furnish a greater product in the same labor-time; in a word, more difficult conditions for the profitable employment of his capital. While competition, therefore, constantly pursues him with its law of the cost of production and turns against himself every weapon that he forges against his rivals, the capitalist continually seeks to get the best of competition by restlessly introducing further subdivision of labor and new machines, which, though more expensive, enable him to produce more cheaply, instead of waiting until the new machines shall have been rendered obsolete by competition.

If we now conceive this feverish agitation as it operates in the market of the whole world, we shall be in a position to comprehend how the growth, accumulation, and concentration of capital bring in their train an ever more detailed subdivision of labor, an ever greater improvement of old machines, and a constant application of new machine — a process which goes on uninterruptedly, with feverish haste, and upon an ever more gigantic scale.

But what effect do these conditions, which are inseparable from the growth of productive capital, have upon the determination of wages?

The greater division of labor enables one laborer to accomplish the work of five, 10, or 20 laborers; it therefore increases competition among the laborers fivefold, tenfold, or twentyfold. The laborers compete not only by selling themselves one cheaper than the other, but also by one doing the work of five, 10, or 20; and they are forced to compete in this manner by the division of labor, which is introduced and steadily improved by capital.

Furthermore, to the same degree in which the division of labor increases, is the labor simplified. The special skill of the laborer becomes worthless. He becomes transformed into a simple monotonous force of production, with neither physical nor mental elasticity. His work becomes accessible to all; therefore competitors press upon him from all sides. Moreover, it must be remembered that the more simple, the more easily learned the work is, so much the less is its cost to production, the expense of its acquisition, and so much the lower must the wages sink — for, like the price of any other commodity, they are determined by the cost of production. Therefore, in the same manner in which labor becomes more unsatisfactory, more repulsive, do competition increase and wages decrease.

The laborer seeks to maintain the total of his wages for a given time by performing more labor, either by working a great number of hours, or by accomplishing more in the same number of hours. Thus, urged on by want, he himself multiplies the disastrous effects of division of labor. The result is: the more he works, the less wages he receives. And for this simple reason: the more he works, the more he competes against his fellow workmen, the more he compels them to compete against him, and to offer themselves on the same wretched conditions as he does; so that, in the last analysis, he competes against himself as a member of the working class.

Machinery produces the same effects, but upon a much larger scale. It supplants skilled laborers by unskilled, men by women, adults by children; where newly introduced, it throws workers upon the streets in great masses; and as it becomes more highly developed and more productive it discards them in additional though smaller numbers.

We have hastily sketched in broad outlines the industrial war of capitalists among themselves. This war has the peculiarity that the battles in it are won less by recruiting than by discharging the army of workers. The generals (the capitalists) vie with one another as to who can discharge the greatest number of industrial soldiers.

The economists tell us, to be sure, that those laborers who have been rendered superfluous by machinery find new venues of employment. They dare not assert directly that the same laborers that have been discharged find situations in new branches of labor. Facts cry out too loudly against this lie. Strictly speaking, they only maintain that new means of employment will be found for other sections of the working class; for example, for that portion of the young generation of laborers who were about to enter upon that branch of industry which had just been abolished. Of course, this is a great satisfaction to the disabled laborers. There will be no lack of fresh exploitable blood and muscle for the Messrs. Capitalists — the dead may bury their dead. This consolation seems to be intended more for the comfort of the capitalists themselves than their laborers. If the whole class of the wage-laborer were to be annihilated by machinery, how terrible that would be for capital, which, without wage-labor, ceases to be capital!

But even if we assume that all who are directly forced out of employment by machinery, as well as all of the rising generation who were waiting for a chance of employment in the same branch of industry, do actually find some new employment — are we to believe that this new employment will pay as high wages as did the one they have lost? If it did, it would be in contradiction to the laws of political economy. We have seen how modern industry always tends to the substitution of the simpler and more subordinate employments for the higher and more complex ones. How, then, could a mass of workers thrown out of one branch of industry by machinery find refuge in another branch, unless they were to be paid more poorly?

An exception to the law has been adduced, namely, the workers who are employed in the manufacture of machinery itself. As soon as there is in industry a greater demand for and a greater consumption of machinery, it is said that the number of machines must necessarily increase; consequently, also, the manufacture of machines; consequently, also, the employment of workers in machine manufacture; — and the workers employed in this branch of industry are skilled, even educated, workers.

Since the year 1840 this assertion, which even before that date was only half-true, has lost all semblance of truth; for the most diverse machines are now applied to the manufacture of the machines themselves on quite as extensive a scale as in the manufacture of cotton yarn, and the laborers employed in machine factories can but play the role of very stupid machines alongside of the highly ingenious machines.

But in place of the man who has been dismissed by the machine, the factory may employ, perhaps, three children and one woman! And must not the wages of the man have previously sufficed for the three children and one woman? Must not the minimum wages have sufficed for the preservation and propagation of the race? What, then, do these beloved bourgeois phrases prove? Nothing more than that now four times as many workers' lives are used up as there were previously, in order to obtain the livelihood of one working family.


In addition, the working class is also recruited from the higher strata of society; a mass of small business men and of people living upon the interest of their capitals is precipitated into the ranks of the working class, and they will have nothing else to do than to stretch out their arms alongside of the arms of the workers. Thus the forest of outstretched arms, begging for work, grows ever thicker, while the arms themselves grow every leaner.

It is evident that the small manufacturer cannot survive in a struggle in which the first condition of success is production upon an ever greater scale. It is evident that the small manufacturers and thereby increasing the number of candidates for the proletariat — all this requires no further elucidation.

Finally, in the same measure in which the capitalists are compelled, by the movement described above, to exploit the already existing gigantic means of production on an ever-increasing scale, and for this purpose to set in motion all the mainsprings of credit, in the same measure do they increase the industrial earthquakes, in the midst of which the commercial world can preserve itself only by sacrificing a portion of its wealth, its products, and even its forces of production, to the gods of the lower world — in short, the crises increase. They become more frequent and more violent, if for no other reason, than for this alone, that in the same measure in which the mass of products grows, and there the needs for extensive markets, in the same measure does the world market shrink ever more, and ever fewer markets remain to be exploited, since every previous crisis has subjected to the commerce of the world a hitherto unconquered or but superficially exploited market.

But capital not only lives upon labor. Like a master, at once distinguished and barbarous, it drags with it into its grave the corpses of its slaves, whole hecatombs of workers, who perish in the crises.

We thus see that if capital grows rapidly, competition among the workers grows with even greater rapidity — i.e., the means of employment and subsistence for the working class decrease in proportion even more rapidly; but, this notwithstanding, the rapid growth of capital is the most favorable condition for wage-labor.