CHAPTER 3

For communism, this paragraph acquires an especial significance, because production and reproduction are consciously derived from this principle, whilst in the case of capitalism the process completes itself spontaneously through the market mechanism. Reproduction rests on the fact that, for each product consumed, a new one generally must take its place. In the case of communist society, this means that an exact account must be kept into everything entering the production process. However difficult this may appear to be, it reality it is quite simple, because everything which has been used up and destroyed may be classified under two categories: means of production and labour-power.

Under capitalism reproduction is an individual function. Each single capitalist, the unit of capital, attends to their own reproduction needs. The capitalist takes account of the fixed means of production worn out and used up (machines, buildings), the consumption of circulating means of production (raw materials and auxiliary materials) and the labour-power directly expended. To these are then added supplementary expenditures, such as marketing costs, insurance, etc., and finally the capitalist goes to market with the finished commodities. Should the business be successful, a period of production is therefore successfully concluded. The capitalist now purchases new means of production and new labour-power and production can once again commence anew. Since all capitalists act in the same way, the result is that the entire system of production, together with the labour-power expended, are reproduced. The development of technique, and the increasing productivity of the production system resulting therefrom, compels the capitalists, through competition, to invest a part of their surplus-value in additional capital, in new means of production and in an enlarged productive apparatus. The result is the growth of an ever-mightier productive inventory, the "dead" as well as the "living" parts of the productive apparatus. Thus it is not only those means of production which have been used up and destroyed in the previous production period that are reproduced, but - to use the relevant capitalist terminology - accumulation takes place. The decision as to the scale on which this is to operate and in whose factories it is to be effected is a function of the individual capitalist or capitalist group, whose motives are bound up with the struggle for profit.

Under communism, accumulation is termed reproduction on an extended scale. Here, the market and the transformation of commodities (products) into money are eliminated, but the stream of products remains:

Thus the industrial establishments place their products at the disposal of society. Nevertheless, the latter must for its part supply the factories with new means of production, raw materials and labour-power, in the same quantities which originally entered into production. Indeed, if production on an extended scale is to be achieved, a greater quantity of means of production, etc., must be supplied to the factories. The competent decisions concerning this, however, no longer remain in the hands of private capitalist groups owning means of production, but society as a whole determines the degree to which production is to be enlarged, to the extent that this is required for the satisfaction of social and individual needs. If it is the case that new means of production must be supplied to each factory, in the same quantities as those which have been used up in production, then for reproduction to take place it is necessary and sufficient that each factory calculates how much social product it has used up in various forms (also in the form of labour certificates). These are then replaced in the same quantities, and a new labour period can begin.

If we should ask to what extent it is possible to determine the number of labour-hours used up in each industrial establishment, it is modern cost-accountancy which provides the decisive answer. For reasons that need not be elaborated upon here, capitalist methods of industrial accumulation were compelled, around 1921, to proceed with a thoroughgoing rationalisation, and it was in this way that there appeared, around 1922, an entire new literature concerned with the development of new methods for calculating the exact cost-price for each separate productive process and for each separate subsidiary labour function. This was made up of many factors, such as: quantities of means of production, raw materials and auxiliary materials used up, labour power, and the administrative costs of each separate partial productive process or special partial labour function: transport, social insurance, etc. They are, however, all related to one common denominator: money, and it is this which the industrial administrator sees as a hindrance standing in the way of exact accounting. But nothing stands in the way of converting them into another accounting unit. Also, the formula in its present form is often unstable in conditions of socialised production, because various factors which appear in the cost budget - for instance, interest on capital - would then be no longer relevant. The method itself, however, remains an enduring advance. In this respect also the new society is born within the womb of the old! Leichter writes in respect of modern cost-accountancy:

"Capitalist methods of accounting control can, if introduced into a factory consistently and free of snags, provide exact data revealing the value of any half-produced article, any piece of work still in process of manufacture, or pinpoint the costs of each separate labour operation. They can determine in which amongst many different workshops in a factory, in which amongst many different machines or many different units of labour-power a particular labour operation may be more economically carried out; that is to say, they can at any time be used to increase the highest degree of rationalisation achieved by the manufacturing process. To this must be added yet a further achievement of capitalist accounting methods: in every large factory there are a number of costs and expenses which make no tangible contribution to the exchangeable product." (Meant here are such things as the salaries of officials, heating costs of the workplace, etc. - the Authors) .. " It should equally be counted among the great achievements of capitalist accounting methods that it has enabled these detailed costs to be included in the total works budget." ( 4 )