Material interests and economic class

The concept of class is central to Marxian theory. However, politically or­ganized classes do not emerge spontaneously under capitalism. At first, in­dividuals within the economy see themselves narrowly as isolated agents pursuing interests uniquely their own.

However, the distance covered between pure economic interest and polit­ical action is considerable. Before economic interests can play a role in politics directly, individuals must be aware of their shared interests, organize on the basis of them, and overcome collective action problems. We will, therefore, begin with the way Marxists think about interests.

Marxists advance the following claims about interests:

1. Interests arise within the structure of production. The wants of the in­dividual depend upon his place in the process of social reproduction. The individual has “economic” or “material” interests in satisfying his private wants. Within (civil) society, the position of the individual in the social division of labor determines his wants, which determine his interests.

2. Private (or self) interest can best be understood if we first understand the class to which the individual belongs. That is, the divisions within civil society primarily responsible for determining wants divide individuals into classes. Thus, the interests arising within civil society are implicitly class interests.

3. These interests of classes stand opposed. The degree to which one class achieves its material interest measures the degree to which the other fails.

4. Class interests arising within production become political interests in­volved in the struggle over state power.

While these four points identify important aspects of the transition from material interest to political action, we caution against a mechanical inter­pretation. There is no one-for-one correspondence between economic location and politics. Indeed, some of the most significant political debates (such as that between Leninist and Kautskyist positions) have taken place over how this transition should be made.

First, how do class interests and classes themselves arise within the econ­omy? Marx’s economic theories provide a detailed answer to this question. As Charles Bettelheim points out, within his economic studies Marx seems to “inscribe the division of society into classes entirely within the relations of production” (1985:19, italics in original). In the following, we briefly sum­marize Marx’s argument.

According to Marx, a capitalist economy appears, on first glance, to consist of a vast accumulation of commodities, a set of individuals who own those commodities, and a set of (exchange) relations connecting those individuals. These individuals do not see themselves as members of a class, nor do they see their interests as class interests. In order to get from a world of individual and independent property owners to classes we need to know how the struc­ture and dynamics of the capitalist economy lead to the grouping of persons and of wants, not only on the basis of their personal affinities or unique circumstances, but on the basis of their position within an objective structure of production.

The key element of Marx’s argument for the emergence of classes starts by questioning the classical theory’s understanding of the purpose of the market. Here Marxian theory argues that the market economy is not so much a mechanism for maximizing the private welfare of individuals generally as it is a means of facilitating the capitalist’s appropriation of surplus-value and accumulation of capital. The market makes sense as a social institution be­cause it makes possible self-aggrandizement and private accumulations of wealth in the form of capital. We can use one of Marx’s better known for­mulations to clarify this idea.

Let the letter M represent a sum of money, and letter C a collection of particular commodities (which Marx terms “use-values” following Adam Smith - so many chairs, shirts, loaves of bread, and so on). In a neoclassical world, individuals hold money only in order to use it to purchase some commodity that yields utility to them. In order to acquire the money they need for the purchase of the commodities they want, individuals sell some commodity (or commodities) they own. Some examples: An individual owns his laboring capacity but wants to buy housing, food, and clothing; he or she sells labor (power) for a wage (money) and buys the things needed with it. Marx would depict this sort of activity as follows:

C (laboring capacity) → M (wages) → C (means of consumption).

Another example would involve the sale of an old car and use of the proceeds to purchase a personal computer:

C (used car) → M (proceeds from sale) → C (computer).

Marx terms this the simple circulation of commodities and argues that it characterizes noncapitalist market systems and that it also exists explicitly and implicitly within capitalist economies.

Marx distinguishes capitalism by the fact that in addition to and in a sense dominating over this simple circulation, capitalism institutes another circuit that reverses the terms of commodity circulation as previously understood.

M→ C→ M'.

Unlike the circulation of commodities, the circuit of capital has money rather than useful things as its objective. The capitalist advances money (M) in the hope and expectation that his investment (capital) will return to him with a profit (M'-M), which Marx terms the “surplus-value.” For Marx, then, the market has two purposes to serve in a capitalist setting. It provides a mech­anism for circulating commodities so that those commodities can find their way into the hands of those who need them (C-M-C) and it provides a mechanism for using money to make money or accumulating capital (M-C- M').

What determines whether a particular property owner aims to satisfy needs or to accumulate capital, and why should this distinction in intention (1) ultimately depend upon objective, structural conditions rather than on pref­erences or psychological disposition, and (2) arise out of a distinction between classes rather than individuals? It must be admitted that Marx’s own answers to these questions do not seem terribly well developed, and that while Marx­ists since Marx have come some way in clarifying the issue, their method has focused attention in other directions. Still, some important elements of an answer emerge clearly enough.

First, which objective an individual adopts must surely depend on which he finds available. Assuming that only some persons have capital to advance for purposes of accumulation, only those will be able to adopt the objective Marx identifies with the capitalist class. Those without capital have nothing to sell but their labor. In Marx’s famous formulation the laborer must be

free in the double sense, that as a free man he can dispose of his labour-power as his own commodity, and that on the other hand he has no other commodity for sale, is short of everything necessary for the realization of his labour power. ([Capital, Vol. I, 1867], 1967a: 169)

Marx develops an argument to demonstrate that this difference between capitalists and workers will reinforce itself over time, making capitalists pro­gressively richer and increasing the size of the barriers to workers becoming capitalists.

This difference in social condition precedes individual interest and indi­vidual consciousness. In this sense, the economy itself defines the social positions in which individuals find themselves. The simple scheme outlined above defines only two social positions and it defines them according to the condition of owning or not owning capital. If we use the term “social class” in this purely economic context, it refers to no more than this difference in social condition. This is the most primitive, and problematic, interpretation of class. Membership in a class does not, in this context, impose itself on the mind of the individual who continues to act as an individual, not as part of a class, and need not even be aware of his class identity. Classes in this sense (objective classes, classes in themselves) are politically inert. To see how they become active politically, we pursue three issues below: conflict among classes, class consciousness, and class actors in the political arena.