REJUVENATING THE LEFT ?

Does the CPM Cadre have any choice between the Devil & Deep Blue Sea?
Since the demise of old guards who walked out of National Council of CPI in 1964 there is little left within the CPM for an ideological debate. Despite fall of former USSR & East European communist countries most of the discussion has been cosmetics and in particular since 2004 CPM has banded backward when it supported Congress led UPA government and its chosen Presidential candidates Pranab Mukherjee who has been a chief architect of Civil Nuclear Agreement with America and who also talks about convergence of two culture US-India thought there is hardly anything in common between two nations.
Although in 2008 CPM Congress honeymoon came to end but behind the door top leaders like Sitaram Yechuri continued with flirtation! For example, rather than critically evaluating UPS's performance over the last one year Mr Yechuri decided to provide a covert VOTE of confidence in his former ally Sonia Gandhi. Even within his class politics as Mr Yechuri puts it Manmohan Singh Montek Singh economic policies led the cournty into both inflation and recetion. I wonder on what basis he says that Manmohan Singh has been successful given his class approach and policies?
Similarly, just a couple of weeks before the Parliamentary Elections, Sitaram Yechuri in a Stephen College town hall meeting organised by Burkha Dutt of NDTV openly accepted that he wanted Mrs Sonia Gandhi to be the Prime-Minster of India in 2004. One suspects once again,if he was sending a signal that CPM - Sonia honeymoon has not yet over?
For the last two decades CPM has left with no option but either ended up siding with BJP on no confidence issue against UPA or with Congress in its anti-communal rhetoric although its own record during its 35 rule in WB has not been so good. Despite Muslims being about 28% CPM has done very little to accommodate the minority in government jobs let alone accommodating them within the party!!! CPM's Central Committee and the Politburo is already dominated by the upper caste petty bourgeois former SFI leaders (mainly JNUine rather than genuine) and a further nomination of SFI leader to Rajay Sabha goes to show CPM leadership heading towards meeting the fate of former USSR and East European communist parties. In fact, in former USSR party bureaucracy has taken over after the Party took the power but in India it has taken over even before it could see the power at the Center.
Although I haven't seen the blue print yet as to how they will rejuvenate Party, it would be wise if the these easy chair speculators like Sitaram Yechuri, Brenda Karat and Prakash Karat voluntarily sideline themselves as people have already rejected their leadership! Unless there is something emerges from the grass-root to challenge the Central Committee and Politburo no worthwhile outcome can be expected. Rather than power coming from below and response from the top this petty bourgeois JNUine leadership has justified its hobnobbing with Congress and Corporate in the name of democratic centralism. In fact, CPM has become a caucus-run social democratic party which totally relies upon the bourgeois tactics and would not be an overstatement if people perceives it as Corporate Communist Party of India. In fact, bureaucracy has occupied central place in CPM even before it could takeover the Sate Power which came in CPSU after taking over the power. Rather than getting into squabbles CPM got enter into serious debate as to mainly four issues: (i) If Communist Parties are allowed to function is there any need for democratic centralism, (ii) if Party represents the tangible consciousness of a class and its Central Committee goes wrong what could be done?, (iii) Is socialism in one country still possible, (iv) A country with a huge middle class and where classes are not as homogeneous as they were in 19th Century to what extent dictatorship of working class relevant?
Hence, differences between Sitaram Yechuri and Prakash Karat are that of semantic than real to perpetuate the status quo ante to secure their place in politburo though for nonagenarian Achhutanandan (only survivor who walked out in 1964 to form CPM) was demoted for saving the CPM face in the Assembly poll.
In my opinion unless there is an upsurge from below against the rotten and intellectually defunct leadership which could Bombard the Headquarters as Mao puts it very eloquently, there is not even a remote possibility of rejuvenating the Party.

The puzzle of productive and unproductive labour

In their desperate search for profitable fields of investment, the capitalist class, especially the financial oligarchy, has presided over an explosive growth of unproductive expenditure that today threatens to undermine the very edifice of capitalism. As more and more surplus value is siphoned off into unproductive activities, the issue of “productive” and “unproductive” labor has once again resurfaced as a factor contributing to, and a reflection of, the present terminal decline of world capitalism.

“Capitalist production is not merely the production of commodities, it is, by its very essence, the production of surplus value”, explained Marx in volume one of Capital. “The worker produces not for himself, but for capital. It is no longer sufficient, therefore, for him simply to produce. He must produce surplus value. The only worker who is productive is one who produces surplus value for the capitalist…” 

Adam Smith, the classical economist, also uses a similar definition regarding “productive” and “unproductive” labor. “There is one sort of labor which adds to the value of the subject upon which it is bestowed; there is another which has no such effect. The former, as it produces a value, may be called productive; the latter, unproductive labor.” 
In their greed for profit, the capitalists have diverted more and more capital from the “productive” sectors of the economy into the “unproductive” sectors, such as finance, insurance, property dealing, currency speculation, derivatives and other unsound activities. This edifice of speculative activity serves to artificially expand the market in all kinds of ways, but at the expense of building chronic instability into the foundations of the system. The capitalist system has therefore increasingly become a house built on chickens’ legs, whose foundations are being undermined by the very contradictions of the capitalist economy.
The terms “productive” and “unproductive” work were considered of great importance to the early nineteenth century classical economists which underpinned their labor theory of value. While their understanding was far in advance of today’s bourgeois economists, who have become mere apologists for the capitalist system, it was nevertheless undeveloped and contained certain errors. It was left to Marx to correct these errors and furnish a scientific explanation of “productive” and “unproductive” labor. This was chiefly expounded in his Theories of Surplus Value, particularly the first volume, where he dealt with the definitions of Adam Smith and others. This analysis can provide valuable insights into the crisis and instability of modern-day capitalism.
In this present epoch, there has been a general shift in economic activity from industrial production to service industries and finance capital, but which are ever-reliant on the real wealth produced by industry. In the advanced capitalist countries, millions of jobs have been eliminated in steel, coal mining, shipbuilding, and car manufacturing, while the proportion employed in the service and financial sectors have grown continuously.  This has meant a general shift towards a renter economy, which was anticipated by Marx, and increasingly indicated the parasitic nature of capitalism.

Thatcherism

In Britain, Margaret Thatcher epitomised this short-sighted process by seeking to rebuild the position of British capitalism through services and banking. However, a modern economy cannot survive without a manufacturing and industrial basis. The DE-industrialisation of Britain over the last 30 years or more and its reliance on financial services, has not served to strengthen British capitalism, but weaken it. As a consequence, it was one of the hardest hit by the 2008-9 world slump.
Whereas Adam Smith once justified capitalism with the phrase “It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest”, today he would need to justify the actions of the market with reference to the junk bond salesman, the fund manager and the investment banker.
He would need to explain things in terms of the clients of Goldman Sachs who bought into a sub-prime mortgage deal called Abacus 2007-AC1, which had been constructed with the input from the Paulson & Co hedge fund, which was betting that the entire thing would implode. Such are the vagaries of modern capitalism, where parasitic finance capital has become dominant.
“The ‘entrepreneurs’, i.e. the monopolies, are not interested in an extensive increase in capacity when they cannot see a future market, and when they cannot make use of already existing capacity…” explained Ted Grant almost 40 years ago. “Now they are faced with the major problem of limited markets both at home and abroad, while saddled with surplus capacity.”  This surplus capacity is only a reflection of the over-production of capital and consumer goods, which has been the common characteristic of the present stage of capitalism. “Over-production, the credit system, etc., are means by which capitalist production seeks to break through its own barriers and to produce over and above its own limits”, states Marx.  In the present epoch, it is a reflection of the limits of the capitalist system.
This has forced the capitalists to look for new, more profitable fields of investment, as opposed to industry, that guarantees them quick returns. In the end, they have developed the notion that they could make money, “a quick buck”, without recourse to long-term investments in productive industry. The capitalists, particularly the financiers, wanted to make money out of nothing, without resorting to the laborious process of commodity production. That is why they have resorted to old-fashioned medieval financial alchemy to make money. When fortunes can be made with a single phone call, why bother to risk capital by investing in costly machinery which may never make a profit?
Surplus value extracted from productive activity was formulated by Marx as M —C — M2, where M = money and C = capital, while the attempt to create money from money is simply M — M2, in which production has no role to play. This reveals the real parasitic nature of modern capitalism. “It reproduces a new financial aristocracy, a new kind of parasites in the guise of company promoters, speculators and merely nominal directors; an entire system of swindling and cheating with respect to the promotion of companies, issue of shares and share dealings”, states Marx. 
This development has been expressed in an explosion of speculation and an unprecedented increase in fictitious capital, namely capital not backed by real values. New investments were not made in productive industry but increasingly in gambling on the stock markets, bond markets, shadow banking, in derivatives, currencies, property and other financial instruments which are purely speculative in character. Increasingly, capitalists are buying back shares in their own companies to artificially push up the share price, and engage in money-making mergers, acquisitions and leverage buyouts. The capitalist class has become a barrier to the development of the productive forces of industry, technique and science, which was their historical justification. Instead, they systematically undermine and destroy these productive forces.
Today, central bankers, a real financial aristocracy, have become all-powerful and, together with some 500 monopolies, hold the economic fate of the world economy in their hands.  Never in history have the bankers, with their financial tentacles spread everywhere, become so dominant, and now apparently “too big to fail”.  Since the crisis of 2007-8, these “too big to fail” banks have become even more powerful. After the “Big Bang” of financial deregulation in the mid-1980s, they presided over the biggest orgy of financial speculation of all time. Banking and financial capital rule the roost, which reflects the real parasitic nature of the market economy. This has been accompanied by a general shift towards services, banking and finance, considered “unproductive” sectors of the economy, which are increasingly subsidized by the wealth created by the economy as a whole. This was reflected in the blunt comments of Lord Turner, the then chairman of the UK’s Financial Services Authority, who in 2009 stated that banking was a “socially useless” activity. It reflects the fact that the capitalist system is relying more and more on sectors that do not create surplus value, but act as a constant drain on the productive economy. And yet, paradoxically, they have become increasingly necessary to the capitalist system, as heroin is to a heroin addict. This speculative juggling of money, justified as “essential” activity by the powers that be, threatens to engulf the world in a new financial collapse, which in turn is preparing the way for an even bigger slump and greater depression.

Lenin’s Imperialism

Lenin had explained long ago that a key characteristic of imperialism was the domination of finance capital. “Thus, the twentieth century marks the turning-point from the old capitalism to the new, from the domination of capital in general to the domination of finance capital… The concentration of production; the monopolies arising therefrom; the merging or coalescence of the banks with industry – such is the history of the rise of finance capital.” ⁶  Lenin continues: “Finance capital, concentrated in a few hands and exercising a virtual monopoly, extracts enormous and increasing profits from the floatation of companies, issue of stock, state loans, etc., strengthens the domination of the financial oligarchy and levies tribute upon the whole of society for the benefit of monopolists.” 
“During periods of industrial boom, the profits of finance capital are immense, but during periods of depression, small and unsound businesses go out of existence, and the big banks acquire ‘holdings’ in them by buying them up for a mere song, or participate in profitable schemes for their ‘reconstruction’ and ‘reorganisation’,” a tendency that has become ubiquitous.   “Hence the extraordinary growth of a class, or rather a stratum of rentiers, i.e., people who live by ‘clipping coupons’ who take no part in any enterprise whatsoever, whose profession is idleness. The export of capital, one of the most essential economic bases of imperialism, still more completely isolates the renters from producers and sets the seal of parasitism on the whole country that lives by exploiting the labor of several overseas countries and colonies…” In quoting Schulze-Gaevernitz, Lenin explains that in Britain, which was the dominant capitalist power at that time, there was “an increase in the relative importance of income from interest and dividends, issues of securities, commissions and speculation in the whole of the national economy.” 
Since Lenin’s book on Imperialism, this domination of banking and financial oligarchy has today reached astronomical proportions. Some have claimed that this development represents a new stage in the evolution of capitalism (even inventing the new term of “financialisation”), but this is not the case. It is however undeniable that this tendency has certainly reached a new qualitative high-point and is connected with the present organic crisis of capitalism. The continuous attempts by the capitalists to overcome their contradictions simply lead to new barriers and deeper contradictions. Today, the system has reached a complete impasse and has become incapable of utilizing the productive capacity it has brought into being. In the words of the ever-relevant Communist Manifesto, the system has become a massive fetter to growth and development. “The conditions of bourgeois society are too narrow to comprise the wealth created by them,” states the Manifesto. Therefore, the impasse of the capitalist system is presently revealed in today’s over-production and economic crisis. The fact that capitalism can only use 80% of productive capacity in a boom and a mere 65% in a slump reveals its bankruptcy. The system has become burdened with over-production and “excess capacity”.
The domination of finance capital has meant that the financiers suck up a greater and greater proportion of the wealth created by the rest of the economy. As Marx explained, surplus value comes from production, but is then redistributed to other sectors of the economy. The division is characterized by Rent, Interest, and Profit, the “Holy Trinity of Capitalism”, where the surplus value extracted from the labor of the working class is divided between the industrialists’ profit, the bankers’ interest and the landlords’ rent. While banks and other financial institutions do have a necessary function under capitalism in providing loans, they are parasitic in a way that other capital is not. The share now going to the financial sector has reached colossal proportions. In the United States, during the 1950s and 1960s, an average of 13.1 per cent of domestic profits derived from the finance sector. In the fourth quarter of 2001, that grew to a peak of 45.3 per cent. At the end of 2006, finance was responsible for a third of all domestic profits. Soon afterwards the collapse in house prices took their toll on bankers’ balance sheets, but even then, in early 2009, finance still accounted for a quarter of domestic profits. 
This parasitic renter development has now reached new heights. The “unproductive” sectors are out-weighing the “productive” sectors that produce surplus value and act as a colossal drag on capitalism and its profitability. According to the economist Fred Moseley, “Commercial labor… accounted for almost two-thirds of the total increase of unproductive labor. The other two types of unproductive labor, financial labor and supervisory labor, each accounted for approximately half the remaining increase of unproductive labor.” 
“Productive” and “unproductive” labor has a special meaning for Marxism. In understanding this concept we must be careful. “Productive work” should not be confused with “socially-useful work”, while “unproductive work” should not be confused with “socially-useless work”. They have nothing whatsoever to do with these things. Incidentally, there are no equivalent terms in present-day bourgeois economics for productive and unproductive labor, as all workers are regarded as the same. However, they were extensively used by the great classical economists, such as Adam Smith and David Ricardo, to understand capitalism. People were regarded as productive or unproductive in the capitalist sense, which was the only way they could understand things. After all, the aim of capitalist production is the production of profit. Profit is the surplus value produced by the unpaid labor of the working class. Thus, according to the logic of the system, productive labor is that which creates surplus value.
“A man grows rich by employing a multitude of manufacturers; he grows poor, by maintaining a multitude of menial servant,” stated Adam Smith. The first would increase his profits, whereas the second would decrease his income. In the category of “unproductive” labor Adam Smith included a whole range of people, including domestic servants. This is hardly surprising given the large numbers of servants that existed at that time. The House of Commons report in April 1861 showed that there were more than one million domestic servants in Britain, an even greater number than factory workers. By the beginning of the 20th century, one in four workers was employed in domestic service. While these workers were undoubtedly exploited and forced to work long hours, they were deemed economically “unproductive” as they were paid wages from revenue and did not produce surplus value for the capitalist.
“What a convenient arrangement it is,”  noted Marx, “that makes a factory girl to sweat twelve hours in a factory, so that the factory proprietor, with a part of her unpaid labor, can take into his personal service her sister as maid, her brother as groom and her cousin as soldier or policeman!” 
Domestic servants were not the only people considered unproductive from the point of view of capitalism. As Adam Smith explained:

“The labor of some of the most respectable orders in society is, like that of menial servants, unproductive of any value… The sovereign, for example, with all the officers both of justice and war who serve under him, the whole army and navy, are unproductive laborers. They are the servants of the public, and are maintained by a part of the annual produce of the industry of other people… In the same class must be ranked… churchmen, lawyers, physicians, men of letters of all kinds; players, buffoons, musicians, opera-singers, opera-dancers, etc.”

Marxists use the terms “productive” and “unproductive” labour, but in a more precise manner than defined by Adam Smith. Once again, these terms are not moral judgments about the quality of a person’s job, but are definitions based upon whether or not workers produce surplus value for the capitalists. Clearly people such as doctors, nurses, and teachers are extremely “socially-useful” and essential, but nonetheless, from the point of view of capitalism, are regarded as unproductive workers. “Productive labour, in its meaning for capitalist production, is wage-labor which… produces surplus value for the capitalist… Only that wage-labor is productive which produces capital,” explained Marx.  In other words, these terms refer to what is productive for capital. Likewise, “unproductive” labor, in the capitalist sense, is therefore labor which produces no surplus value for the capitalist. As such, unproductive labor has become an ever-expanding mill-stone around the neck of capitalism which takes an ever-increasing slice of the surplus value produced by the rest of the productive economy.

Exchange-value

Marx explains that the capitalist is not interested at all in the particular use-values created in the production process. The use-value of a pair of shoes, coat or car is simply a means to an end and nothing more. The Moneybags capitalists are interested only in the exchange-value and thereby the surplus value, which they will realize once the commodity has been sold. The whole basis of capitalist production is the production of surplus value, and nothing else. The use-value that is created is neither here nor there. All the capitalist is concerned with is getting “back a greater quantity of labor-time than he has paid out in the form of wages.” Marx therefore concludes that under the profit system: “Only labor which produces capital is productive labor.” 
Whether workers produce material tangible things or not is also unimportant, as long as by their labor they produce surplus value. The workers who produce surplus value get their income by selling their labor power to the capitalist for wages. They are forced to do this out of economic necessity. Surplus value arises in production out of the unpaid labor of the working class. “A writer is a productive laborer not in so far as he produces ideas, but in so far as he enriches the publisher who publishes his works, or if he is a wage laborer for a capitalist,” explains Marx.
In other words, if a capitalist hires workers to make furniture for his personal needs, these workers produce use-values in the form of furniture. While they perform surplus labor (work over and above what they receive in wages), their labor will not take the form of value as the furniture will not be sold on the market. Therefore, as no value is produced, neither is surplus value produced. The labor of these workers is therefore “unproductive” in the capitalist sense as, while it produces use-values, it produces no surplus value.
Thus, the distinction between “productive” and “unproductive” work boils down to whether or not workers produce surplus value, irrespective of the usefulness of the things they produce. Therefore the definition of a productive worker does not come from what is produced, but from its particular social form.  Marx underlines the point by explaining that “Productive capital is here defined from the standpoint of capitalist production.”  So workers producing weapons of mass destruction, despite their abhorrent nature, are deemed “productive” if their labor creates surplus value. That is the only criteria from the point of view of capitalism. As Marx comments, “The use-value of the commodity in which the labor of a productive worker is embodied may be of the most futile kind.” What is produced is of no consequence as the key issue is whether or not it produces surplus value. While nurses and doctors working in the NHS are considered “unproductive”, as they produce no surplus value, if these very same workers were working in a private hospital or a profit-grabbing agency, then they would be deemed “productive” workers from the viewpoint of capitalism! The nature of their work is irrelevant. Everything boils down to whether it generates profit or not, the sole thing that motivates the capitalist.
Adam Smith made the mistake in believing that productive labor was labor that only produced tangible things. The product of an opera singer, stated Smith, vanishes as soon as it is performed. While this is true, he was confused about the nature of a commodity, which can be a tangible thing or a “service”. Both things can produce surplus value, and need not produce a material object. Workers employed in transport and communications, for instance, do not produce a thing, but their work in moving things around is nevertheless vital to the economy. It is irrelevant if surplus value is extracted from intellectual or manual labor. “Alongside the consumable articles existing in the form of goods [exist] a quantity of consumable articles in the form of service”, states Marx. 
The mistaken distinction of Adam Smith arose from the fact that the classical economists regarded the labour of domestic servants as unproductive. While this was correct, Smith drew incorrect conclusions from this fact. Surplus value can certainly arise from a service of some kind, depending on how it is exploited. As explained, a doctor or nurse working for a profit-making private clinic, which does not produce a thing as such, but a service, nevertheless produces surplus value. The opera singer will produce surplus value for the theater owner assuming the singer is only paid the value of their labor power. The earnings taken from ticket sales to watch the performance will be greater than the wages to the performers. In this case, the singer will be deemed “productive” by capitalism. It makes no difference whether the product lasts for a few seconds or not.
“Productive and unproductive labor is here throughout conceived from the standpoint of the possessor of money, from the standpoint of the capitalist, not from that of the workingman,” explained Marx.   Again, Marx provides us with a number of examples. “An actor, for example, or even a clown, according to this definition, is a productive laborer if he works in the service of a capitalist (an entrepreneur) to whom he returns more labor than he receives from him in the form of wages.”

Revenue

Marx then goes on to draw the distinction between those workers who produce surplus value (“productive”) and those who consume revenue (“unproductive”) from the capitalists. “While a jobbing tailor, who comes to the capitalist’s house and patches his trousers for him, produces a mere use-value for him, is an unproductive laborer... The former’s labor [the actor or clown] produces a surplus value; in the latter’s [the tailor], revenue is consumed.”  In other words, the clown produces surplus value for his employer by entertaining the paying crowds, while the tailor’s service simply consumes his money!
From the point of view of the capitalist, the issue boils down to how the money is spent: either “productively” in investing it to produce surplus value, or “unproductively” by flitting it away on pleasantries, such as wine, women and song. Of course, in this Alice-in-Wonderland way of looking at things, one capitalist’s pleasure is another capitalist’s profit. The capitalist who hires the clown to entertain people makes money, but the capitalist who actually goes to see the clown spends his money on an entrance ticket. For the producer, these services are commodities which create profits. However, for the buyer, these services are mere use-values, objects which consume a person’s hard-earned revenue!

“For example”, explains Marx, “the cooks and waiters in a public hotel are productive labourers, in so far as their labour is transformed into capital for the proprietor of the hotel. These same persons are unproductive labourers as menial servants, inasmuch as I do not make capital out of their services, but spend revenue on them. In fact, however, these same persons are also for me, the consumer, unproductive laborers in the hotel.” 

If I am a cook employed in a rich person’s home, my labor is unproductive as my labor is “exchanged directly against their revenue”. But if I work for a first-class restaurant catering for the rich, my labor is productive, as it makes a profit for the capitalist for whom I work. Marx makes the same point. “The cook in a hotel produces a commodity for the person who as a capitalist has bought her labor — the hotel proprietor; the consumer of mutton chops has to pay for her labor, and this labor replaces for the hotel proprietor (apart from profit) the fund out of which he continues to pay the cook. On the other hand if I buy the labor of a cook for her to cook meat, etc., for me, not to make use of it as labor in general but to enjoy it, to use it as that particular concrete kind of labor, then her labor is unproductive… The great difference is (the conceptual difference) however remains: the cook does not replace for me (the private person) the fund from which I pay her, because I buy her labor not as a value-creating element but purely for the sake of its use-value. Her labor as little replaces for me the fund with which I pay for it, that is, her wages, as, for example, the dinner I eat in the hotel in itself enables me to buy and eat the same dinner again a second time.” 

Big Mac

What is actually produced, or the labor that has gone into it, has nothing whatever to do with this distinction. Workers who produce “Happy Meals” at Burger King or MacDonalds are productive workers as they produce surplus value for their bosses. These workers act very much like being on an industrial conveyor belt producing “fast food”. This, however, makes no difference as to whether or not their labor is productive. The determining factor is that the “Big Mac”, even if considered a dubious use-value, is nevertheless a use-value that is sold. In doing so, these workers produce surplus value, despite being classified as “service workers” by capitalist statisticians.
Much of the financial services are unproductive as this sector merely serves to move around large amounts of fictitious capital in the form of derivatives and other financial wizardry. There is no production of surplus value in such activity, but it serves to hoover up an enormous slice of the surplus value created in the productive sector. Such financial juggling is purely parasitic in nature.
Commercial capital simply buys in order to sell, but produces no surplus value from these activities. It is indeed true that a particular capitalist often makes a profit by buying cheap and selling dear, but when this happens, it is at the expense of the capitalist from whom he buys, or to whom he sells. The source of profit is however not in exchange. He merely realizes the surplus value existing in the commodity sold to him below its value by the manufacturer, namely at a discount. In this way, the industrial capitalist will get his money back quickly and will speed his turnover of his capital. As Marx explained, “Commercial capital does not itself produce any surplus value, it is clear that the surplus value that accrues to it in the form of the average profit forms a portion of the surplus value produced by the productive capital as a whole.” 
When you apply this concept to the workplace, it becomes a bit more complicated. In fact, in practice, factories employ a mix of both productive and unproductive labor - those who produce surplus value and those who consume revenue, but are necessary to production. In a workplace, where there is a division of labor, we cannot isolate an individual’s contribution, but view the collective production as the effort of the collective labor employed. These days, many “hands” are involved in the production of commodities of every kind. Modern production is social labor. In other words, each worker has his or her function in the production process, from the cleaner on the shop floor to the production manager. The cleaner plays an indispensable role in clearing up everything, allowing production to take place unhindered, and permitting the assembly workers to carry their work without unnecessary stoppages, thereby helping to increase surplus value.

“Adam Smith naturally includes in the labour which fixes or realises itself in a vendible and exchangeable commodity all intellectual labours which are directly consumed in material production. Not only the laborer working directly with his hands or a machine, but overseer, engineer, manager, clerk, etc. —in a word, the labor of the whole personnel required in a particular sphere of material production to produce a particular commodity, whose joint labor (co-operation) is required for commodity production. In fact they add their aggregate labor to the constant capital, and increase the value of the product by this amount.” 

Marx explains that a plant manager has a day-to-day role to play in the running and organising of production, and arises out of the need to oversee and plan the production process within the workplace. The free reign of the market place is not allowed to operate here! Consequently, due to this function, the manager is entitled to the “wages of superintendence”, to use an expression of Marx. But the role of management under capitalism has a dual role, namely to plan production within the factory, but also to keep the workers in check and under control for the owners and shareholders, which cannot be considered productive labour. Of course, in a democratic workers’ state, the workers themselves will run the workplace under workers’ control and management. This means that the workers will appoint their own worker-managers, under the control of the factory committee, to help supervise production. Their role will be fundamentally different to the capitalist overseer.
Jobs can combine elements of both productive and unproductive labor. For instance, book-keepers or accountants can be productive or unproductive depending on whether they record the necessary balances and inventories for production or simply spend time manipulating the accounts made necessary by capitalism or other related tasks.
A commodity not only has to be produced, it has also to be sold if the surplus value contained within it is to be realised. The labour of those workers employed in wholesale and retail trade has to be considered likewise as an essential part of the productive process as a whole. All must be considered necessary links in the chain of capitalist production. While surplus value is made in production and not circulation, those employed in the distribution or retail sectors play an essential role in selling the commodities produced in the factories. They must serve to realize the surplus value locked-up in the commodities through their sale. Therefore the industrial capitalist sells his commodities to the capitalists in distribution and retail for less than their value. These are then sold at their full value, the difference being the source of profit for these capitalists and the wages of the workers in these spheres. “To industrial capital, the costs of circulation appear as expenses, which they are”, states Marx. “To the merchant, they appear as the source of his profit, which —on the assumption of a general rate of profit — stands in proportion to the size of these costs.”
While workers in commerce and services do not produce surplus value, their unpaid labour does “create his [the commercial capitalist] ability to appropriate surplus value, which, as far as this capital is concerned, gives exactly the same result; i.e. it is its source of profit.”  In other words, the commercial worker does not produce surplus value directly, but indirectly through its realization. Of course, the commercial capitalist will see that the wages paid to his clerical and distributive workers are as low as possible, so that as much of the surplus value as possible represented by the difference between the “factory-gate” price and the final selling price may come to him as profits.
In other words, the circulation of goods is paid from the surplus value produced in production, which makes a claim on the basis of the average rate of profit. Without this cut it would have no interest in being in business. It is nevertheless a cost to the capitalist system. The same is true of distribution. We nevertheless need to differentiate between capitalist circulation and the physical transport of commodities, which is a necessary part of the productive process. 
As a consequence, Marx includes as productive those workers involved in transport. He explains this by saying that “the use-value of things is realized only in their consumption, and their consumption may make a change of location necessary… the productive capital invested in this industry thus adds value to the products transported.”
Today, businesses employ the services of Call Centres to take care of “customer services”, which would be viewed as a necessary expenditure and “unproductive” from their point of view.  However, from the point of view of the owners of Call Centers, these workers would be views as “productive” as they produce surplus value for them!
If a capitalist uses private passenger transport (God forbid!), he spends his own money “unproductively”. The same would be true if he hired a chauffeur to drive him around. However, bus workers carrying paying passengers for a private company produce surplus value by bringing in revenue far in excess of their wages, and are therefore “productive” in a capitalist sense. As can be seen, this concept can therefore be applied to different sections of workers according to how they work for the capitalist and whether or not they produce surplus value.
 How does capitalism define workers who work for nationalised state industries? Under capitalism, the nationalised industries are run on state capitalist lines, geared to making profit for the state. Most of these industries were bankrupt under private ownership and were therefore taken over by the state, which pumped in new investment from taxation. Workers are exploited in these industries as they produce more value than they receive in wages. These state-run industries were then used to produce cheap transport and energy to subsidize the rest of the capitalist economy. They were also milked through massive over-compensation to former owners and high interest rates to banks, which served to siphon off the surplus value produced by these workers to other capitalists.
As these nationalised industries become more profitable, they are normally sold off at a knocked down price to the private sector. When privatized, the workers, who tend to be on worse terms and conditions, now produce surplus value for the new owners of capital.
State employees, no matter how their labor benefits society, are regarded as “unproductive” workers from the view of capitalism. Nurses, doctors and teachers all perform essential work, but those employed by the state are not producing surplus value for the capitalists. These publicly-funded sectors are financed through taxation, which falls heavily on the working class, and lightly on the capitalists. In other words, the labor power of these workers is not exchanged against capital, but comes from state revenues from taxation. The same applies to medical personnel and teachers in further and higher education. While their function is to help keep workers healthy and train a new generation of human labor power, and certainly play an essential role in society, they are nevertheless not “productive” workers for capitalism, because their labor power is still exchanged against revenue and not capital.
The social wage, while vital for people in general, is regarded as a necessary expense for capitalism, and does not produce surplus value. Therefore, for the capitalist class, state expenditure is regarded as a drain and burden on the productive (profit-making) sector of the economy and lies behind the capitalists’ constant drive to reduce state spending. In addition, they attempt to throw the burden of taxation from big business (which pays next to no tax) onto the shoulders of the workers mainly through indirect taxation. State institutions are also pushed to sell or outsource their services to the private sector, increasing the “markettization” of the public services, and acting as a new source of profits. “Patients” and “students” then turn into “customers” by buying their private education and health care. Increasingly, workers in the public sector are outsourced to the private sector. Once this takes place, they change from being so-called unproductive workers to productive workers for capitalism, as they produce surplus value for their private employers.
This process has also occurred in manufacturing with the drive to reduce costs and squeeze as much profit from the unpaid labour of the working class. In fact, much of the so-called service sector, which in any case is not a Marxist term, has come into being as a spin off from manufacturing. As we know, firms that once employed maintenance engineers, cleaners, research workers, computer-programming workers, and other skills in-house, now employ private “service” agencies that provide such specialized needs. Whole sectors, which were once part of manufacturing, have been hived off to drive down labor costs, namely the costs of labor power. Former manufacturing jobs have gone to service companies, whose “services” are either leased or rented back at a reduced cost as workers’ wage levels have been forced down. However, the workers are doing exactly the same work as before, only harder. The main difference is they are employed by capitalist agencies instead of the original manufacturer.

Military-industrial complex

Lastly, the increased burden of “unproductive” sectors of the economy, which whittles away at the very marrow of the system, has been exacerbated by the growth of the military-industrial complex and the colossal burden of defence expenditure on a world scale. While very profitable for the defense contractors, this wasteful expenditure draws vital resources away from the productive economy.
Whatever the position of different sectors of workers, the insane profit driven view of capitalism simply reflects the material interests of the capitalist class. What is clearly evident is the increasingly destructive and parasitic nature of the capitalist system, a reflection of its protracted death agony. The sectors that produce real wealth are contracting to the advantage of those that leech off it, serving to undermine the whole market economy. Nevertheless, the bourgeois economists are blind to this impending catastrophe. As the ancient Greek philosophers said, “those whom the gods wish to destroy they first make mad.”
The return of mass unemployment, which takes the form of a permanent organic character, eats away at the vitals of society. This terrible waste of human labour power, together with the money spent on keeping the unemployed alive for fear of the social and political consequences, is a stark reminder of the complete impasse of the system. The malignant cancer of mass unemployment, especially hitting the youth, is a stark reflection of the diseased state of capitalism in its epoch of terminal decline. Society is now in a complete impasse - in reality a new Depression - as the productive forces are being strangled by private ownership of the means of production and the nation state. The capitalist system has now become a colossal obstacle. Partial reforms and patchwork solutions are of no use. Society needs a new Organizer. The market has utterly failed. The apologists of capital are desperately trying to hold their ground, but are faced with a sea-change of anti-capitalist opposition. More and more will come to realize that the only way out of this impasse is the complete overthrow of the system.
Abolition of private ownership of the means of production is the first prerequisite to a rationally-organized planned economy. Under democratic socialist planning, the anarchy of capitalism will be eliminated. There will be no such thing as “productive” and “unproductive” labor, as exploitation and surplus value will become a thing of the past. According to Marx, society will inscribe on its banners: “From each according to his ability, to each according to his needs!” Humanity will then be able to plan its life rationally, using the full resources and talents available to society, eventually leading to the abolition of classes and the domination of man by man.

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SHARING

Two men, both seriously ill, occupied the same hospital room.
One man was allowed to sit up in his bed for an hour each afternoon to help drain the fluid from his lungs. His bed was next to the room's only window.
The other man had to spend all his time flat on his back. The men talked for hours on end.
They spoke of their wives and families, their homes, their jobs, their involvement in the military service, where they had been on vacation..
Every afternoon, when the man in the bed by the window could sit up, he would pass the time by describing to his roommate all the things he could see outside the window.
The man in the other bed began to live for those one hour periods where his world would be broadened and enlivened by all the activity and color of the world outside.
The window overlooked a park with a lovely lake. Ducks and swans played on the water while children sailed their model boats. Young lovers walked arm in arm amidst flowers of every color
and a fine view of the city skyline could be seen in the distance.
As the man by the window described all this in exquisite details, the man on the other side of the room would close his eyes and imagine this picturesque scene.
One warm afternoon, the man by the window described a parade passing by.
Although the other man could not hear the band -he could see it in his mind's eye as the gentleman by the window portrayed it with descriptive words.
Days, weeks and months passed. One morning, the day nurse arrived to bring water for their baths only to find the lifeless body of the man by the window, who had died peacefully in his sleep.
She was saddened and called the hospital attendants to take the body away.
As soon as it seemed appropriate, the other man asked if he could be moved next to the window. The nurse was happy to make the switch, and after making sure he was comfortable, she left
him alone.
Slowly, painfully, he propped himself up on one elbow to take his first look at the real world outside. He strained to slowly turn to look out the window besides the bed.
It faced a blank wall.
The man asked the nurse what could have compelled his deceased roommate who had described such wonderful things outside this window.
The nurse responded that the man was blind and could not even see the wall.
She said, 'Perhaps he just wanted to encourage you.'
Epilogue:
There is tremendous happiness in making others happy, despite our own situations. Shared grief is half the sorrow, but happiness when shared, is doubled. If you want to feel rich, just count all the things you have that money can't buy.

PRODUCTIVE PRODUCTION IS THE LIFEBLOOD OF CAPITALISM :The most serious problem is the lack of productive investment. In the US, private investment remains below even its long-term share of national output, while public investment peaked with the stimulus in 2010 and has been falling ever since. The capitalists are not investing in the kind of productive activity that would lead to the hiring of American workers in sufficient numbers to allow the economy to take off. The reason is because there is no market for their goods; that is to say, there is no “effective demand”. The economic outlook is dark and uncertain. Nobody wants to spend or invest because they cannot predict the future. The number of jobs increased in 2013 but factory employment continued to decline. Initial forecasts that the US recovery would be led by a manufacturing rebound have been comprehensively falsified. A healthy and sustainable recovery must be based on productive investment, not a larger number flipping burgers in McDonald’s. The costs of investment are actually far lower now than in 2008. Yet business investment in the US is running at only slightly above its 2008 level. A recent survey of the 40 biggest publicly traded US companies recorded that roughly half of them intended to curtail their capital expenditures in the course of 2013. What is the point in building new factories and investing in costly new machinery and computers when they cannot use the productive capacity they already have? In the UK, a mere 15% of total financial flows actually go into investment. The rest goes into supporting existing corporate assets, real estate, or unsecured personal finance. Instead of investing in new plant and machinery, the big companies are borrowing large sums of money at negligible rates of interest in order to buy back their own shares. In the first nine months of 2013 alone, $308 billion was spent for this purpose in the USA. The problem is therefore not lack of liquidity. In the USA, businesses are awash with cash yet they do not invest in productive activity. In the last four years vast sums of money have been pumped into the economy, particularly the banks. The result has been to increase the public debt to alarming levels, without producing any economic recovery worthy of the name. Yet Moody's estimate at the beginning of 2013 (reported by Forbes in March 2013) was of $1.45 trillion in cash stashed away by US non-financial corporations. The increase for the year 2012 alone (included in the total) was of $130 billion. This is not a new phenomenon. In the late 1920s, there was a massive accumulation of unspent cash in the economy—just before the crash. The bourgeois economists have an aversion to pronouncing the word “overproduction” (strangely, some self-styled Marxist economists suffer from the same affliction). But from a Marxist point of view the root cause of the crisis is very clear. Surplus value is extracted in the process of production, but this does not exhaust the process of money-making. The ability of the capitalist to realize the surplus value extracted from the labor of the workers ultimately depends on his ability to sell his commodities on the market. But this possibility is limited by the level of effective demand in society, that is, by the ability to pay. The capitalists’ urge to produce in order to obtain profit is virtually unlimited, but his ability to find a market for his produce has very definite limits. The world economy is perilously dependent upon the USA. In reality, the whole world now depends on US consumption. But consumption in the USA is hardly in an ideal condition to act as the engine of world growth. Median earnings have fallen by 5.4 per cent since the US recovery began. Unemployment hovers around 7 per cent. Consumption accounts for roughly 70 per cent of US gross domestic product and about 16 per cent of global demand. Exporters everywhere are thus hoping the US consumer will come to the rescue. But this creates new contradictions. Last year, surging imports pushed the US trade deficit up by 12 per cent to $45bn per month, which was the largest jump in five years. Imports from China accounted for almost two-thirds of that. If this continues, the US-China deficit will exceed $300bn. On the other hand, US exports fell. Obama’s goal of doubling exports in five years is a hopeless dream. The US recovery might peter out, dragging the global economy down with it.This resembles the old Russian fairy tale of a hut supported by chickens’ legs

THE CRISIS IS STILL ON :Since 2008, all the factors that drove the system upwards have combined to drive it downwards. The massive increase in credit has become a huge mountain of debt, a colossal burden on consumption, which is dragging the economy down under its weight.

While the press and politicians talk about a recovery, the serious strategists of capital are plunged into the blackest pessimism. The more far-sighted economists are talking not of recovery but of the danger of a new and even deeper crisis. The “recovery” is really a convenient fiction, calculated to soothe the nerves of investors and restore “confidence”.

Insofar as it is possible to speak of it, the partial recovery in the USA is the weakest recovery from a slump in history. Normally after a slump, the economy tends to rebound strongly on the basis of productive investment, which is the lifeblood of the capitalist system. But this is not the case now. According to the IMF, the world economy is on track to grow just 2.9%, which is roughly half its pre-crisis level.

The irrational nature of capitalism, trapped in the vice of insoluble contradictions, has been given an even sharper and more painful and destructive character through globalization. “National sovereignty” has become an empty word, as every government is subjected to the vicissitudes of the world market.

Speculation flourishes despite all the talk about regulation. A vast amount of money is sloshing around the world, adding hugely to the danger of an unprecedented economic collapse. The global derivatives market, which amounted to $59 trillion in 2008, had risen to $67 trillion by 2012. This is a measure of the unbridled speculative frenzy that has gripped the bourgeois in our times. The tangled interconnections of the derivatives market, which it seems nobody truly understands, have introduced complex and new risks.

The nervousness of the bourgeois is mirrored in the feverish rise and fall of the markets. The slightest incident can cause a panic: political tensions in Portugal; social unrest in Egypt; uncertainty over the outlook for China’s economy; the possibility of military action in the Middle East leading to a sharp rise in oil prices; any of these things can cause a panic that can plunge the world economy back into a deep recession. The yields on government debt play approximately the same role as the charts on the bottom of a hospital bed that denote the rise and fall of a fever. Beyond a certain limit, the increase in the level of a fever threatens the patient with death.

GOING THROUGH THE ANNALS HISTORY :

There are certain moments in history that are decisive turning points. Such moments were 1789, 1917, 1929 and 1991. At such times the whole process is accelerated, and processes that seemed to be fixed for all time turn into their opposite. To this list of great historical turning points we must now add the year 2008. The new period that opened with the crisis of 2008 finds its reflection in an intensification of the class struggle, and in relations between states, by wars and international conflicts.

Dialectics deals with processes in their development through contradictions. The dialectical method enables us to look beyond the immediately given (the “facts”) and observe the deep-seated processes that lie beneath the surface. The capitalist system historically produces and destroys its internal equilibrium. This is manifested at intervals in the outbreak of crises. In the economic sphere this is expressed in the alternation between booms and slumps, which are a fundamental characteristic of the capitalist system for the last 200 years. Periods of prosperity and full employment are followed by periods of slump in which investment falls off, factories are closed, unemployment soars and the productive forces stagnate.

Marx explains that the fundamental cause of all real capitalist crises is overproduction, or, in the jargon of the modern economists, excess capacity (which is the result of overproduction of the means of production). The fact that society is plunged into crisis because it produces too much is a feature of capitalism that was unknown in previous societies. It is the fundamental contradiction of capitalism, which cannot be resolved within the limits of private property of the means of production and the nation state. For what appeared to be a long period—approximately three decades, this seemed to have been falsified by history.

The collapse of Stalinism was an important turning point. From a psychological point of view it gave the bourgeoisie and its ideological defenders a new lease of life. It further impelled the Social Democracy towards the camp of capitalism, creating new illusions in the “free market economy”. It set the final seal on the former Stalinist parties, which abandoned any pretension of standing for socialism and became a pale reflection of the Social Democracy. The same process led to the virtual collapse of left reform-ism as a definite tendency in the labor movement.

During the last boom, capitalism went beyond its natural limits through the unprecedented expansion of credit and the intensification of the world division of labor through so-called globalization. The growth of world trade propelled the system upwards in what appeared to be an unending spiral of growth. The expansion of credit temporarily increased demand. In the case of Britain, the size of private credit, as a proportion of GDP, has doubled to 200% in the last 50 years. The USA and other countries went down the same road.

The sun shone, the markets boomed and everybody was happy. Everything seemed to be for the best in the best of all capitalist worlds. Then came the crash of 2008. With the collapse of Lehman Brothers, they came very close to a catastrophe on the scale of 1929—or even greater. They were only saved by massive injection of public money. The whole burden of debt accumulated by the private banks was placed on the shoulders of the taxpayers. The state—which the economists insisted had no role to play in the economy—had to prop up the whole crumbling edifice of the “free market economy”.

A SHORT STORY : THE POLITICIAN AND THE PROFESSIONAL....

There was a politician whose hatred for his rival was so deep that the politician one day engaged a professional assassin to eliminate the rival. The assassin took the advance and went ahead with his plan. The assassin assured the politician that he would execute the mission within three days. After the assassin left, as the politician sat with his whiskey - tense and expecting- his rival called him. The rival wanted to join hands with him and form the government. The rival agreed to give the politician the most coveted position in the government. The deal was to preempt a third party to take away the cake. The offer was a dream come true and the politician happily agreed. Neither he nor his rival was ready to delay, so one day after they formed the alliance and organized a massive rally. Both went to address the gathering from together. They both sat on the dais- cool and satisfied with a big smile permanently lingering on their lips.
Then all of a sudden…. ……………..
There was a big ……boom!!!!
The bomb exploded and both the politician and the rival were blown to pieces…
The politician in a hurry had failed to inform and ask the assassin to call off the mission…
After all, the assassin was a professional, who unlike the politician, never changes the side all of a sudden.