Today, you don’t have to be a Marxist to notice that the increasing automation of labor has radical implications for workers in advanced capitalist economies. In his December 8, 2012 New York Times column, economist Paul Krugman explains the phenomenon of “reshoring” – the return of manufacturing to the industrialized nations it once fled.
As robots replace workers, Krugman argues, the labor costs of manufacturing in the United States go down relative to labor costs in, say, Indonesia or Bangladesh. The US also provides the added benefit of bigger markets and better infrastructure. But the jobs that left with the manufacturing industry aren’t coming back with it.
The phenomenon of reshoring is made possible by something Krugman calls “capital-biased technological change”: technological development driven by and in the interest of capital. He illustrates this point by presenting data showing the downward trajectory of US labor’s share of income between 1970 and 2010.
As automated technology becomes more and more sophisticated and efficient, it’s more and more profitable for so-called middle class manufacturing jobs to be performed by robots.
Those jobs have, over the last several decades, been steadily replaced by low-wage service sector jobs that make up a growing trend towards chronic underemployment, permanent job insecurity, deskilling, and de-unionization of the US workforce. All of those factors contribute to downward pressure on wages, producing the stagnation of real wages shown in the data.
Krugman is quick to shoot down the standard liberal line about the need for better education: “Better education,” he writes, “won’t do much to reduce inequality if the rewards simply go to those with the most assets.” What he’s pointing to is a contradiction of capitalism—between the interests of capital and the interests of labor.
He himself isn’t quite sure what to do with this analysis, and admits as much, concluding that, “the capital/labor dimension of inequality…has echoes of old-fashioned Marxism—which shouldn’t be a reason to avoid facts, but too often is. And it has really uncomfortable implications.”
If politics in the liberal-democratic frame has proven incapable of resolving this contradiction—as Krugman acknowledges—then maybe that “old-fashioned Marxism” is worth revisiting and updating. You don’t have to be a Marxist to see that there’s a problem with who owns and benefits from the means of production—but it doesn’t hurt.
Marx himself doesn’t see anything inherently capitalist about technology or automation. In the passage from his Grundrisse known as the “Fragment on Machines”, Marx lays out a pretty intricate argument that the driver of technological change isn’t technology itself, or even the natural sciences—what really points technological development in this or that direction is society’s relations of production, the “who-owns-what” of the economy.
Marx begins the story of “capital-biased technological change” with a schema of the production process capitalism inherited from mercantilism. Its elements are raw material (what is worked on), living labor (who works on it), and the means of production (what they use to work on it).
Each of these has its own specific use-value, the value that is created by its use: Raw material is consumed insofar as it’s made into a product; living labor is consumed in the work process itself, requiring rest and sustenance between work days; and the consumption of the means of production, which can be as simple as a hand tool, uses it up at a far slower rate.
Together, these three elements have to produce more value for the enterprise than the capitalist invested in them. The capitalist takes this excess value (which Marx calls the surplus value) for themselves, and the cycle begins anew. The business must create surplus value in order to grow; the more efficient production becomes, the more surplus value it creates.
But human skill and energy is limited, and capital cannot abide that limit—so it’s the means of production that must constantly be improved and replaced. In the process, the distinction between living labor and the means of production is eroded—for the first time in economic history.
The initial, pre-capitalist schema gives way to a new schema: Instead of raw material, living labor, and means of production, we have circulating capital (not just raw material, but also product) and fixed capital (means of production).
“The relationship of the factors to each other,” Marx writes, now appears as a “difference within capital itself”, so that the elements are just two different kinds of capital. This transformation sounds abstract, but bear with me. What’s Marx really saying?
The three elements are based on the notion of labor inherited from mercantilism, where each is particular element is indispensable. You can no sooner have production without living labor than production without, well, the means of production. But over time, this relation of the elements to each other is absorbed by capital, and changed to fit capital’s insatiable demand to circulate.
Workers, no longer a distinct element from the means of production, are instead subsumed under the category of fixed capital: Living labor is now just another means of production. The “difference within capital itself” is the difference between circulating capital and fixed capital, between what the enterprise circulates and what it keeps.
Capital has an incentive to rely less and less on the strength and skill of human workers in favor of more efficient means of production. This process culminates in the machine. In the form of the machine, and above all the automated machine, “the means of production is transformed into a form of existence most suitable to fixed capital and capital as a whole”.
What’s notable here is that when Marx talks about capital, he describes it not as a passive object, but as an active subject, independent of any individual human’s consciousness. Capital turns the means of production into a part of itself, imbued with capital’s drive to circulate—capitalism’s development is due to an inner logic of capital that’s at work whether we’re aware of it or not.
The most “primitive” means of production are hand tools, which allow/require their wielder to do work requiring skill or strength. By the time Marx wrote the fragment in 1857, technology had already developed so far in the direction of efficiency and automated self-sufficiency that an individual worker’s contribution to the process was often minimal.
The machine, by contrast, is never just a tool, but part of an entire automated system, the monstrous organ of some unfathomable beast. The workings of the system are too intricate and opaque for the ordinary worker to exercise any agency in its use: Rather, the machine dictates what and how to produce, leaving the worker no choice but to observe, maybe press a button or two, mostly just keep the machine running smoothly—in the only manner it was built to run.
No longer skilled creators of the product, workers are instead made increasingly redundant. Some lose their jobs, while others keep working but are relegated to the status of an observer or operator, a status that serves to justify permanent job insecurity and downward pressure on wages.
We can now begin to recognize what Marx’s analysis can tell us about the problem of “capital-biased technological change”: Anxieties about our powerlessness in the face of technological change are really anxieties about capital as a subject, as something not entirely within our control as humans. After all, capital is the agent that drives “technology” to make possible ever greater levels of productivity.
In order to do that—to continually revolutionize the means of production—capital needs something from humans that can’t be replaced by automated machines: Knowledge. “The accumulation of knowledge and skill, the general productive force of the mind of society, is absorbed into capital,” Marx says, “and thus appears as a characteristic of capital, more precisely as a characteristic of fixed capital.”
The knowledge/skill in question isn’t that of the individual worker, whose job it is to supervise the machines. It’s the knowledge/skill accumulated by society as a whole, a sort of collective societal consciousness Marx calls the “general intellect”.
That means the physical and chemical laws we glean from science are applied to the improvement of machines, resulting in more automation and efficiency. Conversely, it also means that “invention becomes a business”, so that the application of scientific knowledge to production actually becomes a driving force of scientific research itself.
Since this kind of knowledge is manifest in the workings of the machine, and not in the worker, the worker is no longer the primary agent of labor. The primary agent is, in fact, the machine—to be precise, it’s the general intellect embodied in the machine.
What’s important for Marx is that the machine, as a means of production, creates value for the capitalist by increasing the ratio of “surplus labor” to “necessary labor”. Necessary labor is the amount of labor the capitalist needs to recoup the cost of buying labor to begin with; surplus labor is that little (or not so little) bit extra beyond the “cost of doing business”.
So the greater the ratio of surplus labor to necessary labor, the more surplus value the capitalist takes for themselves. In effect, technological advancement lets an enterprise produce a lot, quickly, without much input from workers. “[C]apital here—completely unintentionally—reduces human labor, the expenditure of energy, to a minimum,” Marx writes.
But capital also has a tendency to convert potential “free time” into surplus labor. It’s not enough to produce the same amount of products in less time—on the contrary, capital demands growth, which means it demands more products in the same amount of time.
Since the primary source of wealth is no longer labor “in its immediate form” (labor performed by a worker, using the means of production, on raw material), the relationship between wealth and human labor loses all proportion.
This is because, according to the so-called labor theory of value, a product’s exchange-value (its market value) is measured in terms of the time it takes the worker to produce it. Exchange-value, in turn, is the measure of use-value; particular use-values, taken together, constitute wealth.
On one hand, the foundation of value in capitalism remains labor-time; on the other hand, the direction of technological change undermines that very foundation. When this chain of measurement connecting wealth with labor-time breaks down completely, Marx says, the chains of wage slavery will be broken with it.
So at the same time as technology in the hands of the bourgeoisie is a weapon in the class war, it also contains, within very idea, the seeds of capitalism’s collapse. A socialist use of technology would have, as its goal,
The free development of individualities and, hence, not the reduction of necessary labor in order to get surplus labor, but rather, the reduction of the necessary labor of society to a minimum, which contains the promise of the artistic, scientific, etc. development of individuals through the time and resources that have been made free to all.
Not only does technology itself have no agency in Marx’s story, but capital, too, doesn’t have a monopoly on subjectivity. Society’s productive forces don’t exist in a vacuum—they are connected with the social relations that determine how they’re used, what they’re used for, and who benefits from their use.
The distinction between the “reduction of necessary labor” in the interest of extracting surplus labor and the “reduction of the necessary labor of society” is key, because it points to not only the possibility, but in fact the necessity of continuing the development of the means of production in socialism.
It would be wrong to construe this argument as some kind of techno-utopianism: The potential for society’s productive forces to create more “free time” for everyone is just that, a potential. Since subjectivity resides not in the means of production but in capital, the time saved by technology will never be “free” until people liberate society from capital’s tendency to maximize the ratio of surplus labor to necessary labor.
Today, 150 years after Marx wrote the Grundrisse, capital has proven itself to be nothing if not an adaptable subject. In its current neoliberal form, capitalism’s hegemony is global. Does that necessarily mean Marx’s prognosis was wrong? Check back next week for a couple of the answers I find most convincing.