From International Socialism, 2:1, July 1978, pp. 16–42.
Copied with thanks from the REDS – Die Roten Website.
Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).
In recent years, there has been a welcome revival in the Marxist critique of political economy. A good deal of this revival has been concerned with the rediscovery of Marx’s concepts, and much less with their use for comprehending the contemporary capitalist world, If there has been a field where development has been most slight, however, it has been the critique of the capitalist state and its place within the reproduction of capitalism as a whole. Partly, this has reflected the very form that the revival of “Marxist economics” has taken: what Marx did write has been subjected to close (and often useful) scrutiny, wit what he left unfinished has been little developed. (In one area this is an unfair assessment. The debate over the place of “domestic labour” in capitalist society: cf. our bibliography.) Marx intended to continue bin major work with an account of the state and of the world market, though to my knowledge nothing has been preserved even by way of this projected continuation. [1*]
The problem I want to try and discuss here is that of the place of the capitalist state in the capitalist system. Such a project is clearly too large for me to cover this adequately, and all I can hope to do is to indicate some of the problems which seem to require development.
The starting point for any adequate theory of the state must be the general discussions of the state in the writings of Marx and Engels. At the risk of considerable over-simplification, what they said is reducible to a small number of general propositions:
... public power which no longer directly coincides with the population organising itself as an armed force. This special public power is necessary because a self-acting armed organisation of the population has become impossible since the split into classes ... This public power exists in every state; it consists not merely of armed men, but also of material adjuncts prisons, and institutions of coercion of all kinds, of which gentile society knew nothing.
The state is an apparatus of violence, first and foremost, which enforces onto society a “communal interest” or “national interest” which is not the direct product of that society’s members and which maintains the basis of the class divisions. At this high level of generality, these core propositions about the state – and thus about the need to overthrow the state and destroy it as a condition of the realisation of human emancipation through communism – form part of the ABC of Marxism both as a theory of human history and as a theory of human emancipation.
Where problems begin to arise is when we move from this high level of generality to much more specific discussion of the precise relation between state and society within capitalism. It is this area, above all, which Marx himself left very undeveloped, and which subsequent Marxist discussion has, until quite recently, not developed very much further. What we have inherited from Marx are, above all, some brilliant historical accounts of particular crises in the development of the capitalist state, notably in 19th century France, and a superb chapter in Capital, Vol. I on the introduction of legislation in Britain to control the length of the working day. Otherwise, there are. only scattered remarks, like those of Engels in Anti-Duhring on the general theoretical possibility of state capitalism, and very general observations by the young Marx on the alienated character of politics in capitalism. All of these are full of profoundly interesting insights, but hardly constitute a developed theoretical framework.
Indeed, Marx’s. most famous summary statement on the question of the capitalist state is also one of the most misleading:
Each step in the development of the bourgeoisie was accompanied by a corresponding political advance of that class ... the bourgeoisie has at last, since the establishment of modern industry and of the world market, conquered for itself, in the modern representative state, exclusive political sway. The executive of the modem state is but a committee for managing the common affairs of the whole bourgeoisie. [2*]
It is a statement with all the brilliant flair of Marx’s best aphorisms. Its very fame, however, has led to its being taken uncritically as the last word on the subject, a last word to which uncritical Marxists have then attempted to find unattainable proofs. Two problems are posed immediately by it.
First, taken literally, the statement is plain wrong. “The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie.” The whole bourgeoisie? If we quite ignore any subtleties about divisions within the bourgeoisie of this or that county, the simple tact is that the bourgeoisie is a world class, an international class of exploiters and parasites that runs a world system of production. Capitalism, from its beginning; presupposed a world market. But the state form within the capitalist mode of production is decidedly not a world state, but a system of national states whose relations with each other are antagonistic. The whole bourgeoisie does not have a state, cannot have a state. No single, universal centre of coercion has emerged out of the contradictions of the world society that capital has forged over the past few centuries. When we talk of the capitalist state, we always mean the nation state, or rather the nation-state system.  And no nation state, clearly, can be seen as any kind of committee for managing the common affairs of the “whole” bourgeoisie.
Second, Marx’s statement has to be taken-by both would-be Marxists and anti-Marxists alike-to mean that the state is the direct property of the capitalists. A good deal of ink has been wasted in the attempt to defend this proposition.  We ourselves have been anything but immune to this idea that the capitalist class directly controls the state and runs it in its own interest. Certainly a mass of “radical sociology” has been devoted to teasing out the supposed ways in which major capitalist interests are inter-linked with the leading personnel of the state through common social origins, common club memberships, common educational backgrounds, common general prejudices, directorships, lobbies, advisory committees, etc., etc. The crucial theoretical problem with all this (admittedly often fascinating) material is that it forgets what sort of a class the capitalist class is, and imputes common interests too easily and uncritically to the bourgeoisie. 
The capitalist class is, foremost, the class which drives the competitive accumulation process of capital. It is a class which, as against the working class, is united by its demand for surplus-value. But it is also, at the same time, a class which is internally divided by competition. Exploitation and competition are, indissolubly, the two defining features of the social relations that define the bourgeoisie. In Marx’s phrase, the bourgeoisie are “hostile brothers”. They share a mutual interest in the extraction of the maximum total quantity of surplus-value out of productive labour; but they are equally engaged in permanent internecine strife with each other over the distribution if that surplus-value.
The very structural antagonisms that define the internal relations within the capitalist class make it exceptionally difficult to conceive how, with all the common club-memberships, old school tie connections, inter-marriages and multiple directorships in the world, the capitalists of a particular country are capable of forming a common political will sufficient to enable them to dictate the policies of the state. For the state to be a direct instrument of a class, that class must be capable of forming a cohesive view of its interests and a common will sufficiently strongly to wield such an instrument. If any class in history must, precisely because of the mode of production it supervises, find that requirement difficult, it is the capitalist class.
Three consequences follow: first, that in practice the state must have a degree of “autonomy” from the capitalist class; second, that while we must by no means deduce from this that the state is “neutral” in the class struggle, its class character, its specifically capitalist character, must be demonstrated on other grounds than those commonly used by “radical” sociologists and political scientists; third, that the very “autonomy” of the state from the immediate control of the capitalist class is a source of reformist illusions in the possibility of the working class “using” the capitalist state machinery to achieve the destruction of capitalism.
So we cannot understand the place of the nation-state in the movement of capital, if we rely on the kind of analysis by writers like Ralph Miliband , or, indeed, his “opponent” Nicos Poulantzas – who forget the specific character of the capitalist system in order to demonstrate or argue the capitalist character of the state. In Miliband’s case, the problem is that quite simply he treats the capitalist class as a class capable of acting as a purposive subject in history, pursuing common goals, when it is precisely that which cannot be demonstrated. Poulantzas, in practice, despite his many differences with Miliband, regards the problem of formulating a theory of the capitalist state as a problem for “political theory”, as if there were a separate theory of the “capitalist economy” which is relatively irrelevant to the political sphere, as Picciotto and Holloway point out. [5*] He does not treat as problematic the very distinction between “politics” and “economics”, except in the most abstract sense imaginable. And, in his “concrete” studies, Poulantzas, despite much surface sophistication, does fall back on notions about the “interests of monopoly capital” as if these were capable of being read off from history like elephant tracks.
At the most general level, we might say that the problem with what has in practice been the dominant tradition of Marxist discussion of the state and capitalism has been that it has not begun with capitalism, but with class society in general. The alternative, then, is to begin with capitalism as a mode of production.
An adequate Marxist analysis of the state and its relation to capital needs to begin with a consideration of the form that class relations take in the capitalist mode of production, and not merely in “class society” in general. This implies that the starting point for theoretical development should be, not Marx’s occasional “political” writings, but rather his full theoretical treatment of the alienated forms of social relations characteristic of capitalism That is, it is not from writings like The 18th Brumaire of Louis Bonaparte that we should begin, but from Capital and Grundrisse.
In this perspective the character of the state and its relation to the processes of capital accumulation becomes a matter of great significance for the critique of political economy. We have to tease out the forms in which the state itself is the expression of the same fundamental alienated social relations that are expressed in the notions of value and surplus-value, accumulation and competition, and examine the limits of the possibility of “state intervention” in overcoming the contradictions of capitalist social relations.
It is characteristic of reformist thought that it looks to the state to do just that, to overcome the contradictions of capital. For reformism, in its various guises, the state stands Over and outside capitalism as a source of power which is capable under favourable circumstances of being captured by socialist principles and employed to destroy capitalism. Nothing, of course, could be further from Marx’s whole analytical conception than this, but nonetheless he never concretely worked out the links between the fundamental forms of social relations he analysed in the three volumes of Capital, and the forms in which the capitalist state appears. This was to have been achieved in a projected volume continuing the analysis in Capital, which was never even drafted in outline.
It is this task, theoretically, which has been taken up by a number of recent Marxist theorists, especially in Germany, [6*] I cannot cover all the ground or all the ideas they develop, or offer an adequate critical assessment of their work here. What I will do is to take some ideas from their work, and show how they make – I think universally – a mistake whose significance increases with the aging of the capitalist system.
The starting point for the German theorists, analytically, is a question posed in the 1920s by the great Bolshevik legal theorist, Pashukanis.  Engels, Pashukanis suggests, had theorised the state as a necessary product of class society and class conflict. But in so doing he had failed to ask why the state takes on the specific form it does, and why it performs the specific functions it does, within capitalist society.
Behind all these controversies one fundamental problem lies concealed: why does the dominance of a class not Continue to be that which it is-that is to say, the subordination in fact of one part of the population to another part? Why does it take on the form of official state domination? Or, which is the same thing, why is not the mechanism of state constraint created as the private mechanism of the dominant class? Why is it dissociated from the dominant class-taking the form of an impersonal mechanism of public authority isolated from society? [7*]
To this question, several kinds of answers have been given, which we can quickly outline, not in opposition to each other, but rather as if they were all additions to a rounded account. First, the fact that capital can exist only as many capitals in competition with each other means that the reproduction of the whole society is a problem. In a society constituted as a market, in which production is carried out in isolated units related to each other antagonistically through exchange, some institution outside the production units must enforce order on them, guarantee the rights which each must recognise if social production as a whole is to continue. The maintenance of contractual relations requires the development of law, and of an institution of coercion to enforce contracts and rights. Put another way, since the interests of each isolated individual in commodity production include no conception of a general interest of society, the state is required to enforce a common interest on all participants. (The state, in this perspective, is required as Thomas Hobbes’ Leviathan was required, to save humanity from the consequences of its own nature “red in tooth and claw”!)
The fierce competition between capitals means that capitalist society cannot ensure its own continuance, its own necessities, without some other institution outside capital to enforce a common interest on capitalist society. In his analysis of the development of the Factory Acts, Marx showed that the intervention of the state became necessary to prevent 19th century British capitalists from so extending the working day that they risked destroying the very foundation of their capital accumulation, the living labour-power of the working class. [8*]
The paradoxical result of the workers’ struggle to limit the working day was that, through the state, they enforced on capital its own interest in further development. The point is taken further in the current German discussion, in an argument (derived from a section of the Grundrisse) that capital accumulation involves the necessity of certain “general conditions of production” which capital itself – being constituted of many mutually antagonistic capitals – is incapable of providing. The state thus provides certain deficiencies of capital which it cannot itself provide. These include: the provision of certain parts of the economic infrastructure – e.g. roads, postal communications, nationalised industries, etc.; the provision of a legal system through which rights and contractual responsibilities are enforced; the regulation of the conflict between workers and capitalists, and where necessary the political coercion of the workers; safeguarding the expansion of national capitals on the world market (the imperialist function). Here the state is seen as providing certain necessary “general conditions of production” which private capitals themselves cannot directly provide. The existence of the state as a coercive institution separate from capitals, a product of the capital relation but not itself capital, is posited as a necessary aspect of the capitalist mode of production.
Capitalism, of course, is not merely, or even principally, competitive production of commodities; it is a mode of production based on the production and accumulation of surplus-value. It is not merely an anarchic system of production and distribution, it is a class system. The bean of capitalist social relations is constituted not simply by relations of antagonistic separation of producers, but by relations of domination. But the system of domination is hidden. On the surface of society, in the market relations between capitals and between capital and labour, it appears that everything is fair and equal; everyone gets, more or less, the value of his commodity, including the worker who sells his labour-power. In Capital I, Marx suggests that force is not a permanent necessity for capitalist exploitation to continue. Workers contintue to produce surplus-value for their employers, not because there is permanently a gun at their backs, but because if they don’t they will starve:
The advance of capitalist production develops a working class which by education, training and habit looks upon the requirement of that mode of production as self-evident natural laws. The organisation of the capitalist process of production, once it is fully developed, breaks down all resistance. The constant generation of a relative surplus population keeps the law of supply and demand of labour, and therefore wages, within narrow limits which correspond to capital’s valorisation requirements. The silent compulsion of economic relations sets the seal on the domination of the capitalist over the worker. Direct extra-economic force is still of course used, but only in exceptional cases. In the ordinary run of things, the worker can be left to the “natural laws of production”, i.e. it is possible to rely on his dependence on capital, which springs from the conditions of production themselves and is guaranteed in perpetuity by them. [9*]
There is a good deal more to the contribution made by the German Marxist theorists to the understanding of the relation of capital to the state than appears above, and their work – with its many controversies and insights – deserves serious study. At the same time, in a few respects all the German theorists appear to agree on a particular approach to the question of the state which I wish to question.
They all tend to see the state in two unsatisfactory ways: firstly, they all treat the state as a necessarily unproductive sphere of activity, as being outside the concept of “capital” itself, as not-capital though necessary for capital; and secondly, they all tend to treat ”the state” in the singular. The two problems, I suggest, are related. The implication of their theorising of the state are such as to rule “state capital” out of court as a theoretical impossibility, a “non-thing” – a position which must tend, I suggest, to make it more and more difficult for them to apply the concepts they have developed to the analysis of contemporary capitalism, in both the East and the West (not to mention the South).
As to the first point, Muller and Neususs treat the state “as a particular social institution which confronts productive society” [10*]; Altvater writes:
... capital cannot itself produce through the actions of many individual capitals the inherent social nature of its existence; it requires at its base a special institution which is not subject to its limitations as capital, one whose transactions are not determined by the necessity of producing surplus value, one which is in this sense a special institution alongside and outside bourgeois society. [11*] 
And Hirsch writes that
The function of the bourgeois state can never be more than the creation of the “external” conditions for the social reproduction process which regulates itself on the basis of the law of value. The social process of production and reproduction cannot be the direct object of state activity ... [13*]
And before them all, the Bolshevik theorist of law Pashukanis had declared,
The principal of competition – which is “dominant in the bourgeois-capitalist world as we have already noted supra – provides no possibility of associating political authority with an individual enterprise – after the analogy of the association of such authority with great holding of land under feudalism. [14*]
Thus a rigid conceptual distinction is maintained between “state” and “capital”. The “external” concerns of states tend to be tagged on as an afterthought , not taken into the general analysis of the form and functions of the capitalist state. 
Contrary to the position implicitly or explicitly assumed in much of the contemporary discussion, I suggest that the state can itself “be a capitalist”, in the sense that the state institutions can directly become the “conscious bearer” of the capital-relation, that the state can have as its direct object of activity the social process of capital production and reproduction within a national sphere, that “political authority” can be associated with “an individual enterprise” even while the total activity of the state cannot be thus defined as directly “capitalist”. In particular, it seems to me to fly in the face of current actual developments in the world economy to deny that the state can be a productive capitalist, that is, a capitalist under whose direct dominion surplus-value is produced. In other words, the state can be funded not only through its taxation of revenue from productive capitals falling within its “political sphere” but can itself also directly exploit productive labour.
In part this position assumes that what Marx termed the “general conditions of production”, and which Marx discussed very briefly in the Grundrisse, are not produced by this or that nation-state for “capital in general”, as much of the discussion tends to assume. Rather, they are produced by this or that nation-state for “its” capital, or capitals, not to facilitate capitalist production in general, but to facilitate national capitalist production conducted in competition with capitalist production under the aegis of rival nation-states. This also therefore assumes that the production by states of the “general conditions of production” includes state activities which are both “productive” and “unproductive”, in capitalist terms.  (I also assume, though this point is not much further developed here, that the production of the “general conditions of production” is not an activity necessarily restricted to states, but is also performed by other capitals and by such forms as the family, under conditions which require to be analysed in their own right. )
There appear, in the light of what has already been said, to be two principal forms of unproductive wage labour within modern capitalism, one of the two forms having important inter-relations with the dominant form of unwaged unproductive labour, “housework”. 
The first of these forms is unproductive labour employed in the sphere of the circulation of value, where labour is employed to realise value for a particular capital or state or to protect it for one capital or state against the depradations of alternative consumers. Here we include workers in finance, insurance, credit, sales , taxes, army, police, security-guards, judges, lawyers, prison officers etc.
The-second kind of unproductive labour is labour employed to reproduce labour-power, a commodity whose actual reproduction does not involve the production of surplus value. Here must be included the activity of productive workers when they are not actually at work for capital (for their own consumption activities are, as Marx noted, also a production process through which they reproduce themselves), the work of housewives, doctors, nurses, hospital porters, teachers, social workers, etc. The labour of these workers does not occur in the sphere of the circulation of surplus-value, but rather in the distinct sphere of the circuit of simple commodity production, the sphere of the reproduction of labour-power.
In Capital Vol. III, Marx showed that the relation between the individual productive worker and his individual employer is in reality a relation between the worker and the entire capitalist class. The worker who produces surplus-value under the direction of his immediate employer turns out in reality to be producing surplus- value which enters into the collective property of the whole class of capitalists,, and which is shared out amongst the capitalists by a process of internal competitive struggle through which (a) values are transformed into prices. (b) a general rate of profit is formed, (c) the claims of finance and landed capitals are met, and (d) – a matter not much discussed by Marx – the tax claims of the nation-state are met. What appears to be the relation between the individual worker and his individual boss turns out to be a relation between the working class and capital as a whole.
Similarly, to the extent that the state enforces taxation and uses the money thus collected to provide all manner of social services, the whole working class is forced to contribute to the costs of its own total reproduction, to the costs of maintaining and reproducing the reserve army of labour, the children, the old, the sick, etc., and to the cost of reproduction of the unproductive labour power which contributes to the maintenance and reproduction of labour-power future, present (actual and potential) and past. On examination, the seeming individualised relation between the individual worker and the individual employer, between the individual worker “citizen” and the state, turns out to be part of a collective, class relation.
There; are limits set to the possibilities of the complete statification of the reproduction of labour-power. The “welfare state”, whose development has on the one hand undoubtedly been the product of workers’ struggles over a number of generations, cannot be viewed simply as a set of “concessions” wrung out of capital and its state by the labour movement, cannot be seen simply as a “positive gain”. Not only because, as the cuts in welfare in the present crisis reveal, the ruling class are not willing to maintain the same level of “concessions”, but also because the forms of the welfare state are impregnated with the principles of the capitalist state, are shaped by the very process of class struggle through which they have been expanded.
Workers, not surprisingly, do not view the welfare state as “theirs”. Rather, the relation of workers with the agencies of the “welfare state” is one dominated by the bureaucratic relation of the state to its subjects, by the removal of control of welfare state institutions from popular control, by the scrupulous suspiciousness that pervades the dealings of welfare agencies with their “clients” (whether in schools, hospitals, claims for benefits, etc.). The welfare state is a highly alien sphere, whose very architecture declares its drab, alienated character, its miserable and limited pursuit of the “common interest”. Marxist historians are just beginning to write accounts of the welfare state’s various branches which take proper account of the tendencies to bureaucratic centralisation which have marked their development and extension. Certainly, from well before the New Poor Law, workers feared dependence on the state for the reproduction of their labour-power, and for all too comprehensible reasons. A part of workers’ struggle under capitalism has thus always been a defence of the family form of reproduction – as Marxist feminists have just begun to demonstrate. 
All forms of expansion of unproductive labour represent deductions from potential total surplus-value available for recapitalisation in the “productive” sector. On the other hand, the very existence of modern capitalism’s unproductive sector also depends. on the production of sufficient surplus-value to maintain it, and its growth – if growth there has been – has depended on the expansion of the mass of the total surplus value produced.
It would be a mistake to treat all forms of state production as unproductive labour, merely because of the fact of state ownership of the relevant means of production. The state can be a capitalist, and a productive capitalist. The obvious case is the nationalised industry Sector in western capitalism, within which wage-labour is combined with state-owned means of production to produce use-values embodying both necessary and surplus labour, embodying surplus-value. At the same time, the state is a capitalist of a particular sort, whose character as capitalist is disguised by the state form.
It is sometimes objected, that the state cannot be a capitalist, and in particular that the nationalised industries cannot be capitalist enterprises, because of the low or even negative rates of profit which they earn. This objection. however, confuses the surface appearance with the underlying real relations. In order to comprehend the place of the nationalised industries in the total process of reproduction of national capital, it is necessary to remind ourselves of the outline of Marx’s argument concerning value and prices, and concerning the formation of an average rate of profit.
In Marx’s account, the individual values of commodities cannot coincide with their average prices. Surplus value is created only by living labour power, and thus capital would never flow into the less profitable and more “capital-intensive” branches of industry, and capitalism would be marked by permanent technical stagnation. Such a theoretical conclusion does not, obviously, match the actual history of the capitalist mode of production, whose chief historical merit in Marx’s eyes was precisely its massive development of the productive forces.
A systematic deviation between values and prices is thus a necessity for capitalist production as a whole. Marx’s argument, crudely, is that all the surplus-value produced in all the various branches of production enters a common fund which is the collective property of the whole capitalist class. This fact of common property in surplus-value is what gives the capitalist class as a whole a collective interest in the rate of exploitation of the working class in the whole productive sector of capitalism. The distribution of that collective fund of value amongst the various capitalists is determined by competition between the capitalists. And, broadly speaking, the outcome of that competitive struggle amongst the capitalists is that each capital gets back a proportion of total surplus-value in the form of profit, its proportionate share being determined not by its contribution to the collective fund, but by the total size of its capital outlay. Thus the more “labour-intensive” industry produces surplus-value a part of which is transferred through the competitive process within the sphere of circulation to the more “capital-intensive” branch of industry; thus the worker in an industry with a low average organic composition of capital actually labours to produce profits for capitalists in industries with high organic compositions of capital. Through this competitive process, an average rate of profit is formed across the whole of the capitalist production process.
Nor is this the end of the story, for total surplus-value is distributed not only among the capitalists whose production processes contribute surplus-value to the collective fund, but also among other capitalists whose claim to a share rests on the possession of capital in other forms: finance capital, landed capital. Thus surplus-value is divided, not simply into various shares of profit, but also into interest and rent, which represent the claims of “non-productive” capitals. Though Marx has much less to say about this, it is also clear that it is at this point, when the collective fund is being distributed, that the state also steps in with its particular claims which its takes out in the form of taxes. Just as the landlord can press his claim to a share of total surplus-value on the grounds of his monopolisation of land, so the state’s monopoly of force permits its claims to be met as well. The various costs of the state are thus met out of this collective fund of surplus-value.
However, to the extent that the state owns productive capital, as with nationalised industries, it contributes to the collective value- fund as well as deducting from it. At the same time, its monopolistic position – founded finally in its ability to use force, to collect taxes – permits the state to organise the pricing of its products in such a way that it appears that they are simply unproductive, simply “loss-makers”. The state’s ability to tax gives it the power to obtain constant and variable capital by other means than through the price-mechanism.
The implication of the price-mechanism is, of course, that those who actually use (consume) a particular commodity provide the capital producing that commodity with the money that can be reconverted into further constant and variable capital in production. Non-users make no contribution.
The state, on the other hand, is able to enforce payments for its outputs on non-users, or – merely a variation on the same theme – to enforce payments for its output which are disproportionate to their use. And commonly we find nation-states, relying ultimately on their monopoly of force, altering the domestic price-structure, and altering the flows of surplus-value. Thus, state railways commonly make “losses”, in that their monetary revenues from passenger and freight services do not match their monetary outlays, but this does not imply that they therefore cease to operate. (Though, in the hands of private capital, which generally lacks the ability to tax, they would cease to operate, as they would fail to attract further capital). What happens, of course, is that the capital required for the maintenance of the railways, and for their “modernisation”, is provided by the state, through its peculiar powers. The implication is that those who directly use the railways are not the only providers of their money-capital requirements.
In Britain, certainly, it is notable that – with the possible exception of the Inland Waterways Board – the nationalised industries have invested massively in the development of the productive forces under their command, and despite their “low profitability”. Clearly, the financial resources to enable all the modernisation investment that has been undertaken in the electricity supply industry, in gas, in the railways, the coal-mines, etc., has not been secured by the price-mechanism alone. In addition to the revenues raised by these industries through direct sales of their products, they have also depended on the state’s ability to provide them with investment capital in other ways: through the writing off of losses, through loan-capital, through tax-raised money, through various kinds of financial subsidy, etc., All this money raised by the state, by whatever means, and used for these investment purposes must surely be viewed as a portion of total surplus value extracted from capital’s collective fund and redistributed through the state’s coercive ability to define, and enforce, a “common interest” for “national capital”.
On the whole, within western capitalist countries, the nationalised industry form is used by nation-states in situations where, for whatever reasons, (a) the rate of return obtainable by a particular branch of production or capital is insufficient to guarantee the continued investment of private capital (whose only means of “making a profit” is via the price-mechanism) and (b) where, for whatever reasons, the state judges that the continued provision of the use-values produced in that branch of production or capital is in the “national interest”. The state, with its particular powers, takes over the financing of capital in that sector, and to a greater or lesser extent shifts the locus of realisation of value away from immediate purchasers of the use-values produced onto the whole national capital or some other parts of it.
Nationalisation of this or that capital cannot be said to be “in the interests” nor “against the interests” of capital – either of “capital- in-general” or of whatever is defined as “national capital”. Some individual capitals benefit from nationalisations, others lose out. Some receive new money-capital in the form of compensation (if this is paid), some do not; some benefit, in that the state effectively forces other capitals to meet part of the costs of their material inputs, some subsidise more than they are subsidised; some benefit from the maintenance in the nationalised industry of a market for their own output, others do not; some meet the maintained nationalised sector as a competitor, some meet is as an alternative vendor seeking their custom.
It should also be cleat that formal, legal “nationalisation” is by no means the only process to which this kind of analysis is appropriate. To the degree that a nation-state subsidises any capital. it also interferes in the price-formation process, and thus interferes in the movement whereby value is distributed between alternative competing realisation possibilities. What seems to have been a marked tendency towards greater “state intervention” in investment, pricing, etc., means that the various nation-states have become increasingly prominent actors in the determination of the flows of value within national capitalist markets.
In the case of a national economy like the Russian one, the internal market plays only a very small part in the determination of prices. In such a case, the formation of prices is removed a good distance from the processes discussed by Marx in his account of the transformation of values into prices, and the need for a developed account of the tax-form becomes especially apparent. If Russia, where effectively all means of production are in the hands of the state , represents the extreme point of development within a national economy, there are clearly significant shifts in this direction also manifest within western capitalist countries.
In western capitalism, the nationalised industries, together with the “semi-nationalised” sector of state-subsidised industries, are to be regarded as a sector of productive labour. In this they are to be distinguished from the rest of the state sector, which is a sphere of unproductive labour. That is, the nationalised industries not only consume value produced elsewhere, but also add to the collective fund of capital their own contribution of surplus-value. But they represent, generally, a sector of capitalist production which – for a variety of historical reasons – has proved incapable of realising sufficient surplus-value to engage in the investment/modernisation deemed necessary by the state in the “national interest”.
The prospective rate of profit earnable on their assets has not been sufficient to induce their private (or municipal) capitalist owners to invest in their future to the degree deemed necessary by national government. It is not possible to treat these industries as “infrastructural” or simply a part of the “general conditions of production”, for they are too diverse to be thus neatly categorised. Even if we can slot industries like gas, coal, electricity, rail, the Post Office, steel into this kind of neat categorisation, examples like Rolls Royce aero-engines, or British Leyland (or indeed Volkswagen or Renault) just do not fit easily into such an over-tidy framework.
Two important general observations of course, need to be made. They are inter-related. The first is that however much state intervention may affect the pattern of domestic national prices, and however much it may affect the distribution of value between competing realisation possibilities the law of value still operates overall. A change in the distribution of value from one possible destination to another does not, in itself, add one iota of additional value to total capital. The general level of the rate of profit is not altered by its redistribution. Any inherent tendencies within capital in general, such as the tendency for the rate of profit to fall, are in no way overcome.  The fact that this or that nation-state becomes directly or indirectly involved in the actual process of surplus-value production, or alters the distribution of value within its sphere, does not in the least alter the general laws of motion of capital, which continue to operate “behind the backs” of the producers, including state producers.
State interventions in the distribution of surplus-value, of the kind involved in nationalisation and subsidisation, does represent a form of capitalist “socialisation” of production. As “socialisation”, of course, it is inherently limited by its capitalist form, and by its national character. Such “socialisation” is carried out, not in the interests of “production” in general, nor even in the interests of “capital in general”, but rather with a view to benefiting those parts of total capital which operate within the national orbit of the state. The costs of running these industries, insofar as they are not covered by receipts from direct sales, are borne by the rest of the national capitalist class, and appear as deductions from their (potential) revenue.
Secondly, we need to remind ourselves of the merely national character of the state. There is an apparent tendency in Marxist theorising about the state, and about phenomena like capitalist imperialism, to treat the external relations of states as factors to be added on to analysis as a mere after-thought. Put another way, there is a tendency to treat the world market as a sum of a set of national economies, rather than treating the world market as the analytical starting point for a discussion of the nation-state.  The world market, intended to be the subject of Marx’s last planned volume of Capital, is not something as it were extrinsic to capital, but is rather implied in the very concept of capital itself.
... just as capital has the tendency on the one side to create ever more surplus labour, so it has the complementary tendency to create more “points of exchange”, i.e., here, seen from the standpoint of absolute surplus value or surplus labour, to summon up more surplus labour as complement to itself; i.e. at bottom, to propogate productioii based on capital, or the mode of production corresponding to it. The tendency to create the world market is directly given in the concept of capital itself. Every limit appears as a barrier to be overcome. [16*]
The formation of capital from the beginning, as the basis of the capitalist mode of production, implied and was contained in a developing world market, within which nation states were formed and differentiated. The formation of a world market (whose geographical reach need not – as Wallerstein recently pointed out [17*] – initially be genuinely global in scope) implies that the processes discussed above, through which values are transformed into prices through the competitive interaction of capitals, occurs not merely on a national but on a world market level. Not only that, but it is through the world market that “socially necessary labour time” is determined for any particular commodity: i.e., it is through the world market, and the competition of capitals therein, that the production process of this or that capital is declared or not declared “necessary”. It is simply astonishing how easily this elementary and important idea is forgotten or not grasped, both by bourgeois and Marxist theorists 
Through the movement of value within the whole world economy, limits are set to the possibilities of nation-state interventions in capitalist production and realisation. This elementary notion is forgotten by those, including most in the Keynesian tradition, for whom “full employment” or any other desirable condition of the national economy can be simply provided if the state pursues the “correct” policies. In practice, no nation-state can have the degree of leverage required to produce the desired result in its own “segment”. Properly, analysis of the world economy should be the starting point for the analysis of the nation-state. 
State interventions in national production, whether in the form of the direct nationalisation of the means of production, or various indirect “semi-nationalisations” such as state-subsidisation, tariff protection for certain commodities, legally instituted limits on rights to transfer capital, etc., imply the formation of “national capital”. How far can we take this notion of “national capital”?
Consider the meaning of a nation-state’s decision to nationalise or otherwise “aid” a segment of industry. What we may say happens in such a situation is that a nation-state places itself in the position of the “directors” of a “national capital”, and tries to decide what policies will best serve the “interests” of that “national capital”. I place “national capital” in quotation marks, since part of the process of decision making actually involves deciding what the practical limits of “national capital” actually are. A nation-state is defined, in part, by its possession of a monopoly of force over a particular segment of geographical territory, for it is as tied to land as was any feudal serf or lord. The various means of production which exist within and outside the territorial limits of the nation-state can, under various circumstances, and depending on government perceptions, be counted as part of “national capital” or counted out of such a conception. Thus, for example, the plant and other facilities which legally belong to companies with their headquarters in other countries may, for certain purposes, be counted as “national capital” and for other purposes they may be counted as “foreign”, “alien”.  Similarly, the overseas holdings of the state’s own legal subjects may or may not be counted as part of “national capital”.
In whatever way the nation-state perceives the shape of its “national capital” for the immediate purpose, it must form its conception of “national capital” in opposition to or in separation from the rest of capital, as against other “national capitals”. In a sense, what the nation-state asks is, does “British industry” require a massive injection of new money-capital into its steel/coal/railway/nylon stockings production?  Will those who currently direct that production themselves provide or raise the necessary investment capital? What are the consequences for “British industry” of a major injection of new investment by the state into that sector – or, on the other hand, of allowing that sector of “national” production to run down? Should tariffs be erected to protect this or that branch of “national” production from overseas competition, and with what results for the rest of “national capital”?
It is clear; from the history of the relations between the state and capital both in Britain and elsewhere since at least the First World War that, with important forward and reverse movements, states have become increasingly “interventionist” vis-a-vis their “national capitals”. “National capitals” have become less and less “notional”, in the sense that large agglomerations of capital are being and have been formed around the nation-states of western capitalism, these “state capitals” consisting above all of the formally nationalised industries whose continued existence depends on a sizeable degree of state subsidisation. The states have carried out forms of “vertical integration” of a variety of sectors of production, collecting them together into statified “conglomerates” with more or less integrated internal structures.
But faced with a crisis in profitability in this or that sector of “national” production, nationalisation or state-subsidisation is only one possible response. For coherence of policy formation is not by any means to be expected in these circumstances; rather, ad hoc adjustments and decisions, reflecting capital’s essential anarchic planlessness, are all too apparent.  Mike Kidron put the point well:
It is difficult not to conclude that the state’s growth in size and economic effect has not been a direct result of pressure from either business or labour. While organised labour has, on balance, favoured state involvement and capital opposed it, nothing suggests that either attitude has had much effect on the actual course of events since the war. On the contrary, the state’s growth has been in a series of disjointed steps that bear every sign of not representing a coherent attitude working itself out in institutional form, but rather a series of ad hoc responses to short-term problems which could not be dealt with in any other way. Since the problems were shared by more or less all western capitalist countries and their institutional arrangements were similar at the outset, it is not surprising that they adopted similar approaches and went through a similar course. [18*]
Though even this is capable of being read too “economistically” in two senses: first, in that it underplays the degree of “uneven development” as between nation-states – witness the lower level of formal nationalisation etc. in the US economy, especially in the 1950s and 1960s; second, in that it leaves unexamined the Ways in which “ad hoc responses to short-term problems” could be dealt with in other ways – i.e., it leaves out the class struggle.
How should “national capital” be organised? There is a permanent debate and struggle among capital’s ideologists as to the appropriateness of “market forces” and “planning”, over the desirable level of statification for “national capital”, etc. [19*] That debate is paralleled within “management theory” in a general controversy over the desirability of centralised control and decision-making as against local managerial initiative and departmentalism within the individual capitalist enterprise. It is also mirrored in the post-Stalin debates in Eastern Europe over the degree to which “market forces” should be permitted freedom of movement and development, given the effects of bureaucratically centralised “planning” on waste, stagnation, etc.  The issue in the debates is, which form of internal organisation of capital will prove most effective in terms of capital’s external necessity of responding to competitive anarchy in the world system. Certainly the debate is not about capitalism v. socialism, but about forms of capitalist organisation and strategy, in which the various schools of thought emphasise particular aspects of the contradictory character of capital, without perceiving the totality. The actual effect of the ideologists on state policy-making is obscure; probably, they appear effective to the degree that their propositions represent actual class forces at particular conjunctures.
The problems of analysis arising from the growth of the state sector in 20th century capitalism are considerable. If, on the one hand, we reject that argument which suggests that the whole of the state sector is a sphere of “unproductive” labour in the sense that it is a sphere of activity financed purely from revenue and which contributes nothing to surplus-value directly, we also have to beware of the opposite trap of treating modern capitalism as a more or less fully formed system of state capitals. In such a view, as presented in an essay by Kidron [20*] for example, the world economy is seen as fundamentally a system made up of an aggregation of “Russias”, with only the added complication that the boundaries of the integrated state capitals do not coincide with the territorial boundaries of states. For Kidron, if such a system is not yet fully formed, this is the tendency of development.
Such an approach, I suggest, involves treating the capitalist nation-state as a rather less contradictory phenomenon than in fact it is. In a senses Kidron makes the same mistake that von Braunmuhl (cited above, section VII) identifies as the mistake underlying a variety of accounts of imperialism: they treat the world market as a sum of national markets, a sum of nation-states, rather than beginning with the totality and treating each national segment and each nation-state within it as a particular field within the whole seen in this light, each national economy appears as a particular combination, a complex unity of capitals with different structures, different markets, different sources for its material inputs, etc. And within world capitalism, at least two general tendencies are identifiable: not merely the one suggested by Kidron.
These are exactly the tendencies that Bukharin identified in general terms in his much neglected work, Imperialism and World Economy (1915): on the one hand tendencies to the nationalisation of production and exchange, on the other hand tendencies to their internationalisation. Both tendencies are very apparent within contemporary capitalism, and in important ways they contradict and reinforce each other. One field in which the contradictory character of these tendencies manifests itself very sharply is within each nation-state: hence precisely the importance, in using terms like “national capital” and “national interest”, of maintaining permanent quotation marks.
“National capital” comprises a very contradictory bundle of capitals. It includes domestically based capitals which are chiefly concerned with the domestic markets for both “capital” and “consumer” goods. They may be private or nationalised. It also includes capitals based and run from overseas, which are oriented towards the domestic market and towards overseas markets. It also includes domestically based capitals which are oriented towards export markets: again, both “private” and “state” capitals are involved – British Steel, British Shipbuilders, Rolls Royce, British Leyland. Among these, some capitals are concerned chiefly with the export of commodities, others with the export of capital, both “productive” capital and various kinds of “rentier” and “finance” capital. Nor are the sources of capital borrowing limited to the domestic market, but include massive foreign borrowings, including borrowings from the growing “euromoney markets”. In the nature of the situation, the process of nation-state policy formation and strategy must be a response to a whole variety of demands and pressures from capitals, many of them necessarily in contradiction with each other. 
The state’s relation to the contradictory demands and movements of capital in the world market, and in its domestic economy as it relates to the world market as a part, is mediated most directly through the more or less accidental aggregate manner in which the inter-relations between capital “within” and “outside” its territorial boundaries are experienced: through the national balance of payments, and through the varying relations between the state-guaranteed national currency and world money, i.e. between the exchange-value of its national money and other national currencies and gold.
So the capitalist nation-state is – even without our taking account of the struggle of capital with the working class over the accumulation and exploitation process – anything but a permanently structured bloc of interests. Rather, the state is a field of intracapitalist conflict, through which at best only temporary and shifting determinations and enforcements of the “national interest” are achieved. Understanding the role of the state as capital is therefore only the starting point – although an essential starting point – for understanding its relationship with the rest of capitalist society.
1. It is odd how little theoretical reflection there is on this question in the Marxist literature. Yet a moments thought suggests it is vital for the comprehension of capitalist imperialism, for the long debate over the “national question”, etc.
2. Ralph Miliband, The State in Capitalist Society, 1969, is probably the best-known of all the proponents of this thesis, according to which the modern state is the “instrument” of the capitalist class. With the possible exception of Claus Offe [3*] none of Miliband’s critics have really attacked him directly on this question.
3. Very often – and Miliband is an exemplar here – the capitalist class is not really the object of attention at all, but rather “the rich” become the chief focus of interest. Thus attention is diverted from the relations of production to the sphere of distribution, and the specific character of the capitalist class is forgotten. The difficulty with Miliband’s propositions is that they could equally well be applied to feudal England or slave-owning Rome, with only marginal adjustments here and there. Miliband’s whole analysis really does not belong to the Marxist tradition of analysis at all: it lacks historical specificity, and lapses into a mixture of sociological elite theory and sociological functionalism. I have an overlong unfinished typescript on the problems posed by Miliband’s kind of analysis, if anyone’s interested.
4. One of the most amazing aspects of the work of writers like Miliband is the practical absence of the class struggle from the centre of their analysis. They provide an account, not of a society riven by class contradiction and struggle, but of a society organised by and dominated by the rich and powerful. (The most effective critique of Miliband along these lines is that provided by Isaac Balbus. [4*])
5. E. B. Pashukanis, The General Theory of Law and Marxism, 1923. This is a regrettably little-known work, which is currently available in English in a classically appalling translation by John Hazard in a volume entitled Soviet Legal Philosophy (Harvard 1951). Hazard’s text can only be understood if the reader can re-translate as he or she goes, for “labour-power” appears as “worker-strength”, “commodities” as “goods”, “exchange” as “barter”, etc. A new translation has been announced for later in 1978 by Inklinks Books. There are useful introductions to Pashukanis in Chris Arthur, Toward a materialist theory of law, Critique 7 (to which a forthcoming critical note in the same journal by Steve Redhead should be noted) and in Eugene and Alice Kamenka, The Life and Afterlife of a Bolshevik Jurist, Problems of Communism, 1970.
6. Altvater is the most explicit in his insistence on this point, and in a way the most revealing. He writes:
... the state is never an actual, material, total capitalist, but rather always simply an idealised or fictitious total capitalist. [12*]
The State, he suggests, is able to play its particular role, of supplying the deficiencies in capitalist reproduction as a whole
... precisely because the sate, as a special institution, outside and above bourgeois society, is not subservient to the necessities of surplus production, as are capital units, no matter how big. The appropriate form of the state under capitalism is therefore its special existence counterposed to capital units ...
Altvater is here making explicit what is implicit in other writers. The state is necessarily “outside and above” bourgeois society; is not subservient to the necessities of surplus (value) production as are “capital units”; is counterposed to “capital units”; etc. Altvater’s whole argument is construed on a reading of Engels’ Anti-Duhring, in which Engels discusses the situation where the centralisation of capital reaches the level of the state, and the state itself becomes a capitalist. Engels writes:
The modern state, no matter what its form, is essentially a capitalist machine, the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of the productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. (my emphasis, CB).
Altvater disagrees with Engels’ formulation, but in so doing revealingly misquotes what Engels said. Where Engels refers to the state as the personification of total national capital, as national capitalist, Altvater leaves out the word “national” and reads Engels as saying that the state becomes the “total capitalist”.
Had Engels said that, he’d have been uttering a Marxist nonsense. A total capitalist would imply a single capitalist controlling the entire capital within the system – i.e., precisely the abolition of capitalism. Capital, pace Marx’s Grundrisse, can only exist as many capitals. The total unification of all capital into one set of hands would imply the direction of production from one centre, whether with or without proletarian revolution. The law of value would be abolished; competitive accumulation could no longer provide the motive of production. (Cf. the discussion of the abstract possibility in L. Trotsky, In Defence of Marxism). To repeat, had Engels said that, he’d have uttered a nonsense. But he didn’t say it. He referred only to the “total national capital”, which is a very different thing. Nor, it’s clear, did Engels regard the state takeover of production as the abolition of the capital relation:
The workers remain wage-workers – proletarians. The capitalist relation is not done away with. It is rather brought to a head. But, brought to a head, it topples over. State ownership of the productive forces is not the solution of the conflict, but concealed within it are the technical elements that form elements of that solution.
In the 20th century we might find Engels a bit optimistic here. But, though he doesn’t theorise the question any further (presumably he assumed his readers would understand him), his meaning seems clear enough. It is of course only comprehensible if we remember a crucial element in the capitalist system which Altvater has forgotten, namely, that capitalist society is a world society consisting of many nation states. A nation-state takeover of the means of production in one country is not, by any means, the centralisation of all capital into one set of hands, thus not the formation of an impossible “total capitalist”.
7. This is very clear in the article cited above by Altvater, who lists four general functions of the state, the fourth of which is “safeguarding the existence and expansion of total national capital on the capitalist world market”. This fourth function is the only one to which he devotes no further analysis.
8. This is a counsel of excellence, which I’m currently unable to fulfil. At least implicitly, some pointers in this direction are suggested below – though I hasten to add that they’re not theoretically integrated.
9. It would be improper of me not to draw attention to the fact that my use of the term “general conditions of production” goes beyond Marx here. For Marx – in a rather abbreviated discussion – defined these “general conditions” as definitely unproductive forms of labour. These conditions of production, he wrote,
... so long as their production cannot yet be accomplished by capital as such and under its conditions – are therefore paid out of part of the country’s revenue – out of the government’s treasury – and the workers do not appear as productive workers, even though they increase the productive force of capital. [15*]
10. On the production in the family of capital’s “general conditions of production”, cf. Ann Foreman, Femininity as alienation, 1977; also relevant to her argument is Jane Humphries, Class struggle and the persistence of the working class family, Cambridge Journal of Economics, 1.3, 1977, and Eli Zaretsky, Capitalism, the family and personal life, 1976.
11. Those who are the “conscious bearers” of capital, the capitalist class and their functionaries, are of course also unproductive.
12. Insofar as sales workers put goods on the shelves for consumers, i.e. physically transport commodities to users, they are productive transport, workers of course. Labour-force statistics, which lump together both productive and unproductive labour in the activity of “distribution” are – like most official statistics – of no use in Marxist analysis.
13. See, e.g. the work of Ann Foreman, Jane Humphries, Eli Zaretsky, cited in note 10. This kind of argument, which takes note of working-class reasons for the defence of the family form, and which is essentially a historically based argument (conducted within the framework of an understanding of the “form determinations” of capitalist reproduction), is probably more important and significant than the kind of “form analysis” of the impossibility of the abolition of the family provided by e.g. Sue Himmelweit and Simon Mohun, Domestic labour and capital, Cambridge Journal of Economics, 1.4, 1977. Apart from anything else, at various periods in various places within the capitalist system, familial reproduction of labour-power has not existed. Cf. the Stalinist labour-camps, the situation of guest workers in West Germany, the condition of many of the slaves in the capitalist slavery system of the USA, etc. Let alone orphanages, state-broken “problem” families etc.
14. Outside that is, the still significant petty-commodity production sector of private agriculture, and the not yet very significant “joint enterprises” like Togliattigrad. The importance of graft also needs to be considered here.
15. Indeed, most commonly they are pushed forward by state interventions, for these interventions tend, generally, towards the encouragement of investment in production processes with a high organic composition of capital, in which the branch rate of surplus value is lower than average.
16. On the general point, cf. Claudia von Braunmuhl, On the analysis of the bourgeois nation state within the world market context in J. Holloway and S. Picciotto, (eds.), State and capital: a marxist debate, Edward Arnold, 1978.
17. For an example of a bourgeois theorist who “forgets” the world economy, this amnesia enabling an account of the US economy as “planned”, cf. J. K. Galbraith, The New Industrial State, 1967. In Marxism, the amnesiac tendency appears in the form of amazingly reactionary and absurd accounts of Russia, China, Cuba and other amnesiac heavens-on-earth.
18. Since writing these notes, I have read the discussion of state industries provided by Rosemary Crompton and Jon Gubbay in their Economy and Class Structure (Macmillan 1977), a book produced broadly within our own traditions of analysis. Crompton and Gubbay distinguish between “capitals” and “quasi-capitals”, with nationalised industries tending to fall into the latter category. A “quasi-capital” is an enterprise that “does not appropriate surplus-value but seeks surplus product as if it were surplus value” (ibid., p. 102).
While there is much of value in their book, I do not find this way of distinguishing between kinds of capital very fruitful. It seems to rest on a confusion, between “value” and “price”. They write:
... insofar as state enterprises are subsidised, cartelised and coordinated, their prices are determined to that extent by central authority rather than by the market; since each enterprises’s products are not pure commodities, surplus labour is not appropriated entirely as surplus value. (Ibid., pp. 109–10).
It seems appropriate to suggest that the final part of this sentence could be restated, in much clearer terms, as follows: “surplus labour is not appropriated entirely through the normal workings of the price system.” No capitalist appropriates surplus value entirely as “surplus value”, outside the immediate process of production; the money which capitalists appropriate as profits is a mediated form of surplus-value, gained after and through the competitive process of realisation of value. The production and the realisation of surplus-value, as Marx remarked, are processes separated, both logically and spatially, and they need to be kept separate if we are to comprehend the particular place occupied by state-subsidised industries.
That doubt raised about Crompton and Gubbay’s book, it is also clear from a first reading that it is an important and path-breaking work in that it seeks to demonstrate the relevance of Marxist categories of analysis in a field where bourgeois analytical frameworks (especially those derived from Max Weber) have long held sway. It deserves careful and critical reading, as a very good basis for further theoretical development.
19. In rhetoric at least, Gaullism in France treated American multi-nationals’ investments in France as “alien” capital. Neither Tory nor Labour administrations in Britain have tended to do this so far: cf. Michael Hodges, Multinational corporations and national government, Saxon House, 1974.
20. Let is not be thought that stockings are a frivolous example. Bear Brand Stockings of Liverpool were held up for a period in the 1970s by state elastic, and only after a review in the DTI were they allowed to slide down when the subsidies were not renewed.
21. The last Tory government, under Heath, is but a case in point. Initially committed to cutting state aid to industry and to de-nationalisation, the Tories did a complete turn-about while in office, nationalising Rolls-Royce and rescuing UCS. They ended up spending 50 per cent more per year in "aid" to industry than Labour had done before them. Cf. e.g. J. Bruce-Gardyne, Whatever happened to the quiet revolution?, 1975.
22. Cf. Chris Harman’s interesting remarks on the tendency towards break-up within Eastern European planning in IS 100, p. 10.
23. These two tendencies, the cheapening of the value of labour-power and the cheapening of the elements of constant capital, are theoretically among the most important “counteracting tendencies” on the famous tendency of the rate of profit to fall. They are – especially the latter – the ones which have proved most troublesome to Marxists seeking to defend this “most important law” against its critics.
1*. Roman Rosdolsky, The Making of Marx’s Capital, 1977, chap.2.
2*. Karl Marx, The revolutions of 1848, 1973. p. 69, (my emphasis – CB).
3*. Cf. Claus Offe, Structural problems of the capitalist state, German Political Studies, 1974.
4*. Isaac Balbus, Modern capitalism and the state, Monthly Review, May 1971.
5*. Cf. John Hollway and Sol Picciotto (eds.), State and capital: a marxist debate, 1978, Introduction.
6*. Cf. ibid.
7*. E.B. Pashukanis, The general theory of law and marxism, in J. Hazard (ed.), Soviet Legal Philosophy, 1951, p. 185.
8*. Cf. W. Muller and C. Neususs, The illusion of state socialism, Telos 25, 1975.
9*. Karl Marx, Capital, Vol. I, Penguin 1976 p. 899.
10*. Hollway and Picciotto (eds.), op. cit., p. 38.
11*. Ibid., p. 41 (my emphasis, CB).
12*. Elmar Altvater, Notes on state interventionism, Kapitalistate, 1, p. ??)
13*. Hollway and Picciotto (eds.), op. cit., p. 64 (my emphasis, CB).
14*. Pashukanis, op.cit., p.186)
15*. Eugene and Laice Kamenka, The life and after-life of a Bolshevik jurist, Problems of Communism, 1970, p. 532.
16*. Karl Marx, The Grundrisse, 1973, pp. 407–8.
17*. Cf. Immanuel Wallerstein, The modern world system, 1974.
18*. Michael Kidron, Western capitalism since the war, 1970.
19*. Nigel Harris, Competition and the corporate society, 1973.
20*. Cf. Michael Kidron, Two insights don’t make a theory, IS 100, July 1977.>
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Last updated: 29.2.2012