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It is now necessary that we return for a while to the question of the social control of production:
With the revolutionary transformation of social relations, private property in means of production is eliminated and these come into common ownership. The legal relationship of the industrial organisations then becomes one in which the former then accept control over means of production in an administrative capacity. This means that the industrial organisations disclose their inventories and then indicate how they propose to deploy their means of production; what this amounts to is that they submit to the Office of Social Book-keeping a production budget drawn up in the form of (p + c) + L = X kg. product. The marxist demand for a system of social book-keeping then finds its realisation in the form of the totality of the production budget: "Their stock-book (ie., society - the Authors) contains a list of the objects of utility that belong to them, of the operations necessary for their production; and lastly, of the labour-time that definite quantities of those objects have, on an average, cost them." (K. Marx: Capital, Vol. 1)
If the total social inventory is given in the form of the totality of the various production budgets, by this means it then becomes obvious that the various participating establishments are therewith brought under social control. Production in an industrial establishment is a continual process. On the one hand, as input, various products flow into the establishment (this includes labour-power), in order that, on the other hand, they may leave the establishment in a new form (output). Each such transformation of material values, however, is registered in the system of general social book-keeping, in the form of an entry of product exchange, and by this means a survey of incomings and outgoings, the debit and credit of any particular establishment, is readily available. Everything which is consumed by the establishment, such as means of production, raw materials or labour certificates, appears as an ingoing entry, and everything which is transferred to society appears as an outgoing. As continuous streams these two must correspond fully with each other, must cancel each other out. By this means an immediate check is at any time available as to whether or not, and to what degree, production is proceeding smoothly.
Should, for instance, an untoward surplus arise in any particular section of production, the office of social book-keeping is able at any moment to make an immediate report to the appropriate control instance (perhaps a joint production commission). It is not possible for the surplus to have arisen as a result of the relevant industrial establishment, at the time of the delivery of the product, having calculated more than the correct Average Social Production Time, since the latter has been made public knowledge. It must therefore be due to an error in the production budget. Should it be verified that it is indeed here that the error actually lies, then the fact has simultaneously been ascertained that the establishment concerned has been operating at a higher level of productivity than had been estimated in the production budget; its productivity factor will consequently be revised in an upwards direction.
The opposite can also occur. The system of social book-keeping reveals a deficit in the output of a certain industrial establishment. This leads in exactly the same way to a revision of the productivity factor and the separate production elements, p, c or L of this establishment. The extent to which these may work against the wider interests of society can be determined by means of the formula:
Out of this simple system of control based on social book-keeping, which proceeds quite automatically as a necessary consequence of the production process itself, there arises yet a further agency of control which is quite remorseless and inflexible in its operation: the reproduction process. If we assume a case in which a productive unit has calculated its Average Social Production Time at too low a level, then we have a situation in which the over-productive establishments are able to make reproduction effective, but they are not in a position to make good the deficit of the under-productive ones. These latter, then find themselves unable to carry through reproduction, and it becomes necessary that society intervene and make good the missing resources out of the GSU budget for the period during which the true figure for Average Social Production Time is being newly computed from the available data.
Conversely, should a surplus arise in one or a number of establishments as a result of the application of too high a figure of Average Social Production Time, no very considerable passage of time will be needed before such an error is brought to light; on the contrary, it will be revealed relatively speedily, precisely because the system is one in which two opposite streams, an ingoing and an outgoing, an input and an output are measured in relation to one another. Over periods of time of given duration, these two must exactly correspond and cancel each other out, whilst over shorter periods this is so only within certain limits - limits which may be relatively easily determined through practice; in all cases, however, the system of automatic control is brought into play through the system of reproduction
Insofar as we have through these observations carried out an examination showing how it is possible for the system of social book-keeping to have at its command an immediate general survey of the production process, we will now proceed to gain an insight into the means whereby it is able to place under its control the other distinct categories of the production formula also.
To begin with, control over the category labour-power, represented by the letter L in the production formula, is made effective by very simple means. The issuing of labour certificates is accepted by the industrial establishment in question only in respect of that labour-power which has been directly expended on its own behalf. If we consider that the production budgets are also maintained by the office of social book-keeping, then the following points are immediately revealed: 1) whether or not the amounts revealed as having been expended in respect of labour certificates issued lie within the limits imposed by the budget; or 2) whether or not the relationship of the labour certificates issued to the quantities either of raw materials consumed or of end-product delivered corresponds with that indicated in the production budget. It is, for instance, already known how many tonnes of, say, coal will be produced per miner, that is to say how many directly expended labour-hours accrue to any one unit of production.
Effective control over means of production is in some degree more difficult, because in this case a distinction must be made between fixed and circulating means of production. It is a well understood principle that the circulating means are absorbed fully into the product whilst the fixed means are absorbed only partially at any given time. Exactly the same use-values can however in the one case appear under the category p and in another under the category c. In a case in which a productive establishment has consumed certain use-values, then the question arises for the office of social book-keeping as to whether that particular entry should have been placed under category p or category c. It would not be appropriate to indicate here just how this question should be solved, since the solution belongs in the sphere of specialised book-keeping technique. The difficulty would, for instance, be eliminated if it were to be adopted as a rule that, a note were to be attached to the order indicating whether the item in question was to be entered under p or c, in much the same way as, at present, it is customary to indicate with cheque payments or money transfers the purpose for which the transfer has been made.
This, however, is not our concern but that of the office of social book-keeping. For our purposes it is sufficient that the categories comprising the production formula (p + c) + L may be given their appropriate registration smoothly and without hindrance, so that in this way each may be supervised and controlled separately whenever necessary. The category c in particular moves only within the limits set by the production budget and must stand in correct relationship to the category L as well as to the end product produced. Any wasteful expenditure of raw materials can thus be uncovered, not only by the production sector concerned, but also by the system of social book-keeping.
If we now consider the category p, we find that it is here that we encounter a difficulty. Such items as machinery, buildings, etc., are absorbed into the product only after a period of some 10 to 20 years, whilst at the same time they are maintained during this period in a utilisable condition by means of maintenance work, repairs, etc. If we assume an average depreciation period of ten years, then a tenth of the total production duration is written off each year; that is to say, it is entered each year into the formula (p + c) + L. After delivery of the finished manufactured product, L and c once again enter fully into the production formula; p however remains to the credit of the industrial establishment concerned. Only after ten years have passed have the fixed means of production been wholly depreciated and become once again due for renewal.
From this it would appear at first sight as if control over p can only be made effective after 10 years, that it is only then that it can be determined whether p has been evaluated at too high or too low a level. This however is only the appearance. The actual production process is characterised, amongst other things, by the fact that the various machines and other plant have differing depreciation periods, and also by the fact that the precise moments in time at which they were placed into service are all different. Thus in any given year old means of production are being replaced by new ones at differing times. For this reason it is not only the categories L and c which move as a continuous stream through the productive establishment, but also p, even if at a slower tempo. In this way it is shown that each productive establishment will need to have employed in one year approximately the full amount of p which has been written off as depreciation.
If we now consider briefly the character of the system of social control, then it is to be noted that, as far as the productive establishments are concerned, in respect of a number of different categories, production in fact controls itself. In the first place, the fact as to whether or not the production budget (p + c) + L has in general been correctly computed and as to whether or not each separate category has moved within the limits designated by the budget represent indices that can be immediately ascertained. In the second place, control is exercised over the quantity of products produced; the result manifests itself as a control over the average production time effective in the production establishment concerned, and also over the average production time applicable in society as a whole. Out of the ratio of the former to the latter there thus also arises yet a further integer: in this case one providing control over the productivity factor.
The entire process of control therefore consists in nothing other than that of the various transfers of use-values and the acceptance of labour certificates for issue, that is to say the objective process of production itself, provides a check upon, and so controls, the production formula. Next we have the end product produced, the result of the objective process of production. This subjects the individual factory or works average, the overall social average and the resultant indicated productivity to open scrutiny by the whole of society. In addition to this, an effective control is brought to bear upon each of the categories separately making up the formula (p + c) + L, as a result of the entry into account of quantities representing labour certificates issued and transfers of use-values produced - that is to say, through the objective course of the production process itself. Finally, the reproduction process (extended accumulation), which represents and embraces objective production as a whole, maintains an accurate final or subsequent means of control.
In those cases in which Average Social Production Time has been calculated at too low a level, the production cooperative concerned will be unable to carry through reproduction; in those cases, on the other hand, in which it has been calculated at too high a level, surpluses will be revealed which it will not be possible to absorb through current production. FORWARD TO CHAPTER 11
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