Part 8: The 'real domination' of capitalism and the real confusions of the proletarian milieu

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Understanding the decadence of capitalism, Part 8

There’s a brand new fashion in the proletarian milieu, a smart little theory which its trend setting designers present as a long-lost secret of marxism, permitting them to explain the historical evolution of capitalist society without – and here’s the beauty of it – having to drag in that commonplace, old-hat theory of decadence which the ICC in particular has been going on about for so long. The ICC and other ‘Philistine’ currents (such as the KAPD, Bilan and Internationalisme) may argue that capitalism passed from its ascendant to its decadent phase at the time of the first world war, putting the proletarian revolution on the agenda and rendering obsolete the old tactics of the workers’ movement (support for parliamentarism, national liberation struggles, etc.); but the truly fashionable just turn up their noses and sneer. No, no, they say, the real secret of capitalism’s evolution is contained in the notion of the transition from its phase of ‘formal domination’ to its phase of ‘real domination’ – a notion which Marx himself developed but which has been given a whole new significance by its contemporary purveyors.

Take a look at the whole ‘neo-Bordigist’ wing of the milieu. There’s the grandly-named Revue Internationale du Movement Communiste, a joint publication issued by Communisme ou Civilisation (France), Union Proletarienne (France), Grupo Communismo (Mexico) and Kamunist Kranti (India). The first three of these groups all lay claim to the ‘formal-real domination’ framework. C ou C have written three long volumes explaining the ins and outs of the theory. Then there’s the newly formed, and even more grandly titled Movement Communiste pour la formation du parti mondial, the result of a regroupment between Cahiers Communistes (France) and A Contre Courant (Belgium). Number O of their review contains a statement of ‘programmatic reference points’, which again emphasises the importance of understanding the notion. And it’s not just the neo-Bordigists. The crypto-councilists who call themselves the ‘External Fraction of the ICC’ don’t want to look old fashioned either. According to a text in Internationalist Perspective n°7 (written by comrade MacIntosh as a contribution to debate but not publicly answered by any other member of the EFICC), the “epochal change from the formal to the real domination of capital” is not only a decisive element in the development of state capitalist, but also “result in the permanent crisis of the capitalist mode of production... renders the contradiction in the capitalist production process insoluble.” According to the EFICC, the ICC remains utterly blind to this starting scientific breakthrough because it has lost all interest in theoretical deepening. To be honest, like many other fashions of the 80s, this ‘theory’ isn’t entirely new. In fact, just as punk fashions were largely a rehash of 50s styles, so the magical properties of ‘formal-real domination’ were first advertised in the late ‘60s by the Invariance group around Jacques Camatte. Invariance was a group that broke with the ‘official’ Bordigism of the PCI (Programma) and began to evolve on certain questions (ie recognising the historical contribution of the German left communists). But its adoption of formal-real domination as the cornerstone of its theoretical edifice didn’t prevent it rapidly abandoning marxism and vanishing into the void of modernism. Indeed, its misuse of the concept definitely helped it on its way. For Invariance, by completing its real domination, especially in the post-1945 period, capitalism, far from being historically obsolete, decadent, sunk in a permanent crisis, had not only demonstrated a capacity for almost unlimited growth, but had become so powerful that nothing could stand in its way. For the modernist Camatte, ‘real-domination’ had come to mean the total, omnipresent triumph of capital, the integration of the proletariat, the end of the perspective of working class revolution. Henceforward, the hope for communism lay as much with the animals and the trees as with the proletariat.

Today’s pioneers of the concept don’t identify with the modernist Invariance, which long ago passed into its final nirvana along with other modernist sects who took up the formal-real domination idea (Negation, Union Ouvriere, etc). But what they do share with Invariance is an inflation, a blatant misuse, of Marx’s notion of formal and real domination. In order to make an outline response to the ideas forwarded by these elements (which is all we intend to do at this stage), and thus come to the defence of the theory of decadence, as other articles in this series have done, we must first go back to what Marx himself said about this concept.


The fact that Marx’s most developed formulation of this notion is contained in a chapter of Capital not published until the 30s, and then virtually unknown until the 60s, has to some extent allowed the latter-day theorisers to surround the whole concept with an air of mystery, to give the impression of a long-buried secret finally brought to light. The EFICC add spice to this mystery when MacIntosh claims that “their basic concepts would have been incorporated into the later volumes of Marx’s projected Capital had the lived to complete them” (IP 7) – which may well be true, but which also down plays the fact that the basic concepts were already there in the only volume of Capital he did complete: Vol 1. The arguments contained in the chapter published later (published in English as ‘Results of the Immediate Process of Production’) are essentially an elaboration of what is contained in the completed volume. In Vol 1, Marx introduces the concept of the ‘formal” and “real subsumption of labour under capital” in his chapter ‘Absolute and Relative Surplus-value’:

“The prolongation of the working day beyond the point at which the worker would have produced an exact equivalent for the value of his labour-power, and the appropriation of that surplus labour by capital – this is the process which constitutes the production of absolute surplus value. It forms the general foundation of the capitalist system, and the starting point for the production of relative surplus-value. The latter presupposes that the working day is already divided into two parts, necessary labour and surplus labour. In order to prolong the surplus labour, the necessary labour is short-ended by methods for producing the equivalent of the wage of labour in a shorter time. The production of absolute surplus-value turns exclusively on the length of the working day, whereas the production of relative surplus-value completely revolutionises the technical processes of labour and the groupings into which society is divided. “It therefore requires a specifically capitalist mode of production, a mode of production which, along with its methods, means and conditions, arises and develops spontaneously on the bases of the formal subsumption of labour under capitalism. This formal subsumption is then replaced by a real subsumption,” (Capital Vol 1, p 645 of the 1976 Penguin ed).

In short: formal subsumption involves the extraction of absolute surplus value, real subsumption the extraction of relative surplus-value. Historically, the advent of this formal subsumption corresponds to the passage from domestic industry to manufacturing: “A merely formal subsumption of labour under capital suffices for the production of absolute surplus value. It is enough, for example, that handicraftsmen who previously worked on their own account, or as apprentices of a master, should become wage labourers under control of the capitalist,” (ibid).

When we turn to the ‘unpublished’ chapter, we find exactly the same concepts, only explained at greater length. For example: “The real subsumption of labour under capital is developed in all the forms evolved by relative, as opposed to absolute surplus-value. With the real subsumption of labour under capital a complete (and constantly repeated) revolution takes place in the mode of production, in the productivity of the workers and in the relations between workers and capitalists,”  (Ibid, p. 1035).

In another passage, Marx makes it clear that the passage from the formal to the real subsumption of labour corresponds to the transition from manufacture (when capitalist grouped together numbers of handicraftsmen and extracted surplus-value from them without any fundamental change in the methods of production) to large-scale industry: “... capital subsumes the labour process as it finds it, that is to say, it takes over an existing labour process, developed by different and more archaic modes of production. And since that is the case, it is evident that capital took over an available, established labour process. For example handicraft: a mode of agriculture corresponding to a small independent peasant economy. If changes occur in these traditional established labour processes after their takeover by capital, these are nothing but the gradual consequences of the subsumption. The work may become more intensive, its duration may be extended, it may become more continuous or orderly under the eye of the interested capitalist, but in themselves these changes do not affect the character of the actual labour process, the actual mode of working. This stands in striking contrast to the development of a specifically capitalist mode of production (large-scale industry, etc); the latter not only transforms the situations of the various agents of production, it also revolutionises their actual mode of labour and the real nature of the labour process as a whole. It is in contradiction to this last that we come to designate as the formal subsumption of labour under capital what we have discussed earlier, viz. the takeover by capital or a mode of labour developed before the emergence of capitalist relations,” (Ibid, p. 1021).

To sum up: the “epochal” change from the formal to the real domination of capital was one which had already occurred when Marx was writing, since it was the same thing as the transition from manufacture to modern industry, which took place at the end of the 18th century and the beginning of  the 19th century. And as Marx explains in his chapter on ‘Machinery and Large-Scale Industry’ in Vol 1 of Capital, it was this passage that was a decisive factor in the rapid and unprecedented expansion of the capitalist mode of production in the ensuing period. In other words: the most dynamic phase of ascendancy of bourgeois society was founded on the basis of the real domination of capital.


1. The Wanderings of Invariance

This is how Marx defined the concepts of formal and real domination. How do the epigones manage with it? “The phase of formal subsumption of labour to capital (XVI – XVIII century) and the phase of real subsumption (XIX - XX)” (‘Les Deux Phases Historiques de la Production Capitaliste, I’ in C ou C no. 5, p.3). Or again:

“In the last third of the 18th century we have the affirmation of the phase of real subsumption, whose mode of extracting surplus value is based on relative surplus value,” (Ibid, p. 33). The problem is with the conclusions that C ou C draw from this: they use it to provide an other argument against the notion of decadence and in favour of the ‘invariance’ of marxism since 1848, since for them communism becomes possible as soon as the phase of real domination begins. This is how they present their work on the ‘Two Historic Phases’: “We hope in this way to clear some of the ground of all the confusions and mystifications which the periodisation of capital is subject to. Finally, the pseudo-concept of a ‘decadence’ of the capitalist mode of production falls to pieces as soon as you open Marx’s unpublished chapter of Capital... “If you consider the capitalist mode of production decadent because it has ceased to play a progressive and revolutionary role, then we’ve been in full decadence since 1848, since from that time on, capital was already sufficiently developed to pose within itself the material bases of communism. Qualitatively, this date has, for us, tolled the bell once and for all. It’s a correct understanding of the periodisation of capital which permits one to affirm, among other things, the following: communism has been possible since 1848,” (ibid, p.4). At first sight, Mouvement Communiste has the same position:

“Marxism has declared the capitalist mode of production to be ‘in decadence’ since 1848, by posing, from this date, the necessity and possibility of the communist revolution,” (MC, no 0, p. 21). But dig a little deeper and you’ll discover that MC are only neo-neo-Bordigists. To take an important example: whereas C ou C, like its acknowledged predecessor, the pre-modernist Invariance, has no shame about affirming the “revolutionary”, “anti-imperialist” character of national independence struggles, in that they allegedly accelerate the passage from formal to real domination in the ex-colonies (cf C ou C no. 9, p.47), MC can’t stomach anything to do with national liberation struggles, and so bends the theory of formal-real domination to suit its own purposes: “With the passage of the capitalist mode of production to its phase of real domination ... which was, on a global, world-wide scale effected by the beginning of the 20th century – the historic balance of forces between the fundamental antagonistic classes means the liquidation of the tactics of support for progressive bourgeois factions fighting against feudalism, of support, in the interests of the permanent revolution, of certain struggles for the constitution of nation states ... as well as the specific tactics of the double revolution. All that remained on the agenda, on a world scale, was the elaboration of ‘direct and/or indirect’ tactics in complete conformity with the purely proletarian and communist revolution,” (ibid, p. 20-21). The same goes for the old tactics of parliamentarism and organising in trade unions. So now we find that for MC, the truly “epochal” change, the one that requires a wholesale alteration of the programme of the workers’ movement isn’t actually the transition from formal domination to real domination, but the point at which this transition is completed on a global scale – which, by a remarkable coincidence, just happens to coincide with the period that certain ‘Philistines’ define as the beginning of the decadent period of capitalism.

In fact this shiftiness, this subtle bending of the periodisation of formal and real domination to suit the particular views of this or that group, isn’t restricted to MC. We find the same with the original trend-setters, Invariance, for whom the real change takes place sometimes in 1914, sometimes earlier, sometimes between 1914 and 1945 and sometimes not until after 1945. And we get similar evasiveness with the EFICC, as we shall see. But for the moment, let’s turn to the true ‘invariants’ C ou C, and their idea that communism has been possible since 1848. We have already dealt at length, in a previous article in this series (see IR 48) with the arguments of the GCI, who claim that communism has been on the agenda since the beginning of the capitalist system. Suffice it to say here that C ou C, despite their claims to marxist orthodoxy, are, no less than the GCI, totally at odds with historical materialism on this crucial question. Central to Marx’s own definition of historical materialism in the Preface to a Contribution to the Critique of Political Economy is the notion that a new society only becomes possible when the old one has become a permanent fetter on the development of the productive forces. Certainly 1848 was a historical watershed, since it witnessed both the first real appearance of the proletariat as an autonomous force (July days in Paris, Chartism, etc), and the first scientific statement of the general principles of communism (the Communist Manifesto). It thus announced that the proletariat was the future gravedigger of capitalism. But in 1848 capitalist relations of production were not at all a fetter on the productive forces; on the contrary, having arrived at the stage of large-scale industry (i.e. of real domination), they were in the process of conquering the whole globe. In 1848 Marx and Engels may have believed in the imminence of the communist revolution. But by the 1850s they had not only reversed their view but also considered that the most important task in front of them was to understand the historical dynamic of capital and so to determine the point at which the system’s inner contradictions would become a permanent barrier to capital itself. They fully recognised that this was something for the future, because capitalism was, before their very eyes, going through its most ‘heroic’ period of expansion and growth Das Kapital is itself the product of this necessary period of reflection and clarification.

The problem with the Bordigists is that they tend to confuse objective, material conditions with the subjective awareness of the proletarian vanguard: in short, they think that the party is omnipotent. In 1848 the communist minority was able to affirm the perspective of communism as the final goal of the workers’ movement; for the neo-Bordigists of C ou C, this marxist prevision is turned into an immediate possibility, as though it was enough for the communists to will it into existence. Marxism has a name for this ideological deviation: idealism.

2. The EFICC: Centrist as Always

With the EFICC’s discover of formal-real domination, its habitual centrism towards councilism becomes, in this particular matter, centrism towards Bordigism. While C ou C and the rest have explicitly developed the framework as an attack on the notion of decadence, the EFICC wants to have its cake (decadence, state capitalism) and eat it (formal-real domination). Through the pen of comrade MacIntosh, they claim that the transition from formal to real domination provides a “causal link” in the chain leading to both the decadence of capitalism and its specific mode of organisation – state capitalism. Unhappily, on how the advent of real domination ‘causes’ the decadence of capitalism, we have no more than the short passage cited above, which itself is no more than a footnote to MacIntosh’s article. We wait breathlessly for the next instalment. But we already note that MacIntosh now has virtually nothing to say about one of the links in the causal chain which he used to talk about very articulately when he used to talk about very articulately when he was in the ICC – namely Luxemburg’s theory of the exhaustion of pre-capitalist markets as a fundamental determinant of the onset of decadence. We wonder whether Rosa’s theory is going to be dumped by the EFICC, who in their quest for reasons for existing are discarding more and more of the basic analyses of the ICC. But for the moment, we can’t pursue this line of thought any further.

In any case, the brunt of MacIntosh’s article is taken up with showing how the transition from formal to real domination compels capitalism to adopt its statified form. It’s a very long article, which contains some interesting contributions on the role of the state in marxist theory. But the argumentation it puts forward about how the transition from formal to real domination explains state capitalism is very thin indeed. To justify his theses, MacIntosh cites certain passages from the ‘Results’, where Marx says that under the real domination of capital, “the real lever of the overall labour process is increasingly not the individual worker” but “labour power socially combined”, and that this shift requires “...the use of science... in the immediate process of production” (Internationalist Perspectives n°7, p. 21, citing Capital, op cit. pp. 1039-40, 1024). From these brief passages MacIntosh leaps to the conclusion that only the state can organise, scientifically, the extraction of relative surplus value from the collective labourer: hence state capitalism and the totalitarian organisation of modern social life. The flaws in this argument aren’t hard to detect. First, while the socialisation of labour is an ‘organic’ product of capitalist development, like the concentration of capital, state capitalism is a response to the break-down of this organic development, a product of the exhaustion of the possibilities for the ‘peaceful’ extension of capitalist production. To find the real causes of state capitalism, you have to explain why the organic growth of capital in its ascendant phase was violently interrupted, and for this Luxembourg’s theory provides a coherent and consistent answer. Secondly, MacIntosh has got his periodisation all mixed up, as we have already argued in our article in International Review n°54. The appearance of the collective labourer, the application of science to the production process, was a development going on in Marx’s own time – in the ascendant phase of capital, in the nineteenth century. The development of state capitalism takes place in the twentieth century, in the epoch of decadence. What MacIntosh has done here is to identify the epoch of ascendancy with the phase of formal domination, and the epoch of decadence with the phase of real domination. As we said earlier on, C ou C are at least consistent with Marx when they place the transition from formal to real domination inside the ascendant period; they’re also within a certain logic to use this as an argument against decadence and to claim that communism has been possible since 1848. But the EFICC are just plan confused.


In Internationalist Perspectives n°12, the EFICC claims to answer our previous criticisms of their periodisation of capital:  " ...the ICC chose to interpret the category of the real domination of capital as meaning not the generalisation of the extraction of relative surplus-value to the whole of the capitalist mode of production, not the decadence of capitalism on the extraction of relative-surplus value, but the mere appearance of this category on the capitalist landscape, its very inception – thereby situating it at the very outset of capitalism ... In fact, far from being situated in the 18th century, or even in 1848, the change from the formal to the real domination of capital was only completed after 1914, its final triumph stretching into recent decades with the spread of the real domination of capital to virtually the whole of the vital agrarian sector.”  We’ve already noted the tendency for the purveyors of this theory to shift the borders of real domination to suit their particular version of the story. Invariance, for example, became more and more interested in chronicling the advances of real domination during the 20th century precisely in order to shore up their vision of an all-powerful, all-encompassing ‘community of capital’. MC and the EFICC, on the other hand, are rather too attached to the class positions they learned from the ICC and so want to emphasise that the crucial change took place at the beginning of the 20th century, when the old tactics of the workers’ movement had to be abandoned. All this takes us a long way from Marx, for whom the categories of formal and real domination had a very much more precise use. They were never put forward as the ultimate secret of the evolution of capital, as the key to the crisis of the system, and so on. It’s not by change that Marx developed the concepts in Vol 1 of Capital, where he deals not with the crisis but with the ‘internal’ relationship between labour and capital, with the direct mode of exploitation at the point of production. Certainly the concept was important for explaining the enormous expansion of capital in his day, but it had no pretensions beyond this.

This can hardly satisfy our latter-day theorists who want the concept to be a worthy rival to the theory of decadence (or, in the case of the EFICC, a new explanation for decadence). For them it has to be pumped up into a huge, all-embracing concept that can account for all the changes in the economic, social and political life of capital. But in doing so, the concept loses all the precision it had with Marx, and becomes utterly blurred and vague. But this also suits the ‘formal-real’ theorisers, since it allows them to mould the notion to their own needs. Take the EFICC, for example. They began by talking about the “epochal” change from formal to real domination as a determining factor in the historical crisis of capital and its evolution towards a statified form. Then the ICC replied: if this change can be located in a particular ‘epoch’, it took place within the ascendant period – so in what way is it an explanation for decadence and state capitalism? So the EFICC try to wriggle out of this by arguing that the ‘epochal change’ may have begun in the 18th century but it’s still going on today... Of course, they’re not exactly wrong here: there remain, especially in the ‘third world’, whole areas of production still only formally dominated by capital. Indeed, there remain whole areas that haven’t even reached this stage yet. It’s a safe bet to say that the final, complete and universal triumph of real domination will never come. But if the effective transition is one that has been going on for 200 years, how on earth are we going to measure the specific changes in the life of capital that this process has brought about? At this point, the whole thing becomes so vague that it begins to disappear from sight. The only way to avoid this vagueness is to recognise, with Marx, that the decisive shift in the mode of capitalist exploitation took place in the ascendant period and that from then on capitalist development and expansion didn’t go through a mechanical repetition of this change in each country or region but took place on the basis of real domination, of large-scale industry with its scientific exploitation of social labour. There’s another serious error contained in the view that emphasises the 20th century, especially the post 1945 period, as the ‘true’ epoch of real domination. Since the shift to real domination was a decisive factor in the phenomenal growth of capital during the 19th century, why shouldn’t the same be true of the 20th? Or, rather, if the change from the formal to the real domination takes place in the 20th century doesn’t it imply that 20th century; doesn’t it imply that 20th century capitalism, far from being decadent, is in its period of greatest growth and development?

This, in fact, is precisely the conclusion reached by Invariance, and one that greatly facilitated its collapse into modernism. It’s also echoed by the current neo-Bordigists who love to ridicule the theory of decadence by pointing to the enormous growth rates in the post-45 period. For the EFICC, which still clings to the notion of decadence, it’s important to at all costs avoid such a conclusion, but logic certainly isn’t in its favour. The current fashion in the proletarian milieu for denigrating the theory of decadence must be seen in this light: it’s a reflection of the penetration of bourgeois ideology into the workers’ movement, and must be combated as such. At the same time, the task of discovering an ‘alternative’ to the theory of decadence as a foundation-stone of revolutionary politics gives an artificial life to a whole host of sects and parasitic groups who would otherwise be hard-pressed to justify their existence; furthermore, because they tend to downplay the catastrophic nature of the present crisis, which is an expression of the veritable death-agony of the capitalist system, the false theorisation about formal-real domination provide a perfect argument in favour of a sterile academicism which looks with snobbish disdain  at those revolutionaries who have committed themselves to a militant intervention in the class struggle. Unfortunately for our professors and experts in marxism, history is accelerating so quickly today that it will soon be disturbing the serenity of their studies with the vulgar stomp of its boots on the streets outside. CDW


“While this general prosperity lasts, enabling the productive forces of bourgeois society to develop to the full extent possible within the bourgeois system, there can be no question of a real revolution. Such a revolution is only possible at a time when two factors come into conflict: the modern productive forces and the bourgeois forms of production... A new revolution is only possible as a result of a new crisis; but it will come, just as surely as the crisis itself” (Marx, The Class Struggle in France).













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