The fact that the individual productive establishments have determined the average labour-time necessary for their product does not mean that the Marxist concept of a social average has been attained. To achieve this, all productive establishments operating in the same sector of production must enter into cooperation with one another. In our example, for instance, all shoe factories must determine the total average out of all the various individual factory averages. Where one factory arrives at an average of 3 hours per pair of shoes, another at 3.25 hours and yet another at 3.5, then the average labour-time would lie at 3.25. (This is, of course, only an approximation; for the accurate formulation, see Chapter 9 of this work).
Thus we can see that the need to calculate the average social labour-time is already leading to a horizontal coordination of productive establishments. This however is not being carried out by a bureaucratic apparatus controlled by the state, but grows out of the factories themselves from below. The whys and wherefores of the system are completely clear and understandable for every worker, whilst at the same time the necessity for open book-keeping brings everything under public control.
The fact that the individual productive establishments arrive at a differing average is an expression of their differing productivity's, which would have its cause in, in the one case a more efficient, in the other a less efficient operation of either the objective means of production or of the living labour making up the production system of each separate factory. In the meantime, our "shoe cartel" calculates for all footwear factories in combination 3.25 hours as their average labour-time, which then becomes the cipher against which shoes enter into individual consumption. A factory which is unproductive, that is to say which operates below the average level of productivity and which therefore, in spite of its best efforts, cannot produce a pair of shoes in less than, say, 3.5 hours, must of necessity operate at a loss. It is unable to reproduce at the socially adequate average rate its ( p + c ) + L for the next production period. As against this, there will be other factories which are overproductive, which operate over the average level of productivity. Taking once again our example, these can produce a pair of shoes in 3 hours. As their product enters into general social consumption, they are able to reproduce their ( p + c ) + L and show additionally a plus increment. Since the social average has been calculated from the averages of all the individual productive establishments, the losses and the surpluses within a cartel must cancel each other out.
What we see here, therefore, is a system of regulation within the production group, and indeed one which has been brought into operation by the productive establishments themselves. It is not a mode of regulation which depends upon "mutual aid" but, on the contrary, is an exact method of calculation. The productivity of a particular productive establishment can be determined accurately, and by this act the limits are exactly fixed within which the losses and surpluses must lie. Productivity thus becomes an exact factor and can be expressed in a single cipher, the Productivity Factor. This factor defines accurately just how large or small the plus or minus figures of a given productive establishment will be.
Although it is not possible to provide a general formula on the basis of which computations within a particular 'cartel' must proceed, since this will necessarily vary with the type and size of the productive establishments comprising of it, we are nevertheless concerned here with an exact quantity. Productivity is determined not only by the quantity of the manufactured product, but is also determined by the relation between the quantity of product produced and the degree to which ( p + c ) + L has been used up in its production. In cases in which a particular productive establishment is under-productive, this means that its ( p + c ) + L has been assessed at too high a value in relation to the quantity of product produced. Put the other way round, ( p + c ) + L has too low an intrinsic or actual value, and the degree to which that value lies below the average is measured by the extent of the deviation from the social average. In our example, our shoe factory computes a factory average of 3½ hours for a pair of shoes, whilst the social average lies at 3¼ hours. In this case, the actual productivity realised stands in inverse relation to the required level, which means that the level of productivity of this particular factory lies in a ratio of 3¼ to 3½ equivalent to 13:14. The factory calculation must therefore always make itself correspond with the social average by application of the formula 13/14ths of ( p + c ) + L, and it is this which must always be applied when calculating its production time for so long as its production remains at that level. Thus the increment which the "cartel" always restores is 1/14th of ( p + c ) + L.
It should be understood, of course, that all this is only by way of example. Since the entire production accounting control stands on the firm ground of labour-time computation, many roads can lead to the same end. What is of fundamental significance is that administration and management always remain in the hands of the producers themselves, whilst each industrial establishment retains full control over its means of reproduction.
Thus the distinction between average social labour-time and the individual factory or works average does actually exist, but is equalised and eliminated through the "production cartel" or "guild", or whatever term one may wish to apply to the grouped industrial establishments of a particular industrial sector in combination. The elimination of this distinction also destroys another argument used by Kautsky against the method of labour-time regulation and accounting control. Following immediately upon his above-mentioned statements of view, he continues:
"Would it in fact prove possible to determine this (the socially necessary labour-time - the Authors) for each separate product?" (K. Kautsky: ibid., p. 319)
" We would in such a case obtain a double answer. The remuneration of the workers would need to take place on the basis of the labour-time actually expended. The prices of the products, on the other hand, would need to reflect the socially necessary labour (12) required for their production. The total of the labour-hours socially expended would need to be the same from one computation to the next. But that would almost never be the case." (K.Kautsky: ibid., p.319)
Would it be possible to determine the average social labour-time for each product, asks Kautsky? Our unhesitating reply is: Yes! - since each industrial establishment and each sector of production is fully able to apply the production formula (p + c ) + L. Kautsky is unable to make anything of this, because he lacks any tangible or concrete conception of the term average social labour-time, and this again has its basic cause in the fact that he perceives all problems purely from the point of view of the central administration. The average social labour-time is calculated from the combined productivities of all the member industrial establishments. From this it is possible to see at a glance to what extent each has deviated from the social norm of productivity. In other words, its Productivity Factor is established. Even though the individual industrial units may deviate from the social average in their individual factory accounting, these deviations are exactly known and their aggregate total is equal to nil. Throughout the production group, as a whole, production takes place according to the formula ( P + C ) + L, which is equivalent to the average social labour-time.
According to Kautsky, however, even the development of technique becomes a hindrance standing in the way of regulation and accounting control on the basis of labour-time. After having declared it to be an impossibility "to calculate for each product the amount of labour which it has cost from its first beginnings right through to the final finishing processes", he proceeds further: "And should one ever complete the task, one would have to begin all over again, since in the meantime the level of technology would have changed in many sectors".
Now isn't that a shame! After Kautsky, looking down from his command post on high, where all the various lines of production come together, has exactly observed all the various partial processes, he finally completes a mammoth calculation which really does reveal exactly how much labour-time is contained in the final social product. At last that's done, thank goodness! And then along comes this devil called technology and throws all his endless calculations into confusion! What a nonsensical conception of production some people have! Production in the real world is such that industrial establishment has an end product which already bears within it the measure of labour-time. When an advance takes place of technology, or its productivity increases for any other reason, the average social labour-time required for this partial process falls. Should the product in question happen to be a final product destined for individual consumption, then it moves into the sphere of consumption with a reduced average, and therewith the matter is concluded. However, should it move on into the sphere of other industrial establishments and enter into their production budgets as means of production, then for the relevant factory the rate of which ( p + c ) is used up falls, that is to say, the costs to this factory are reduced, and as a consequence the average social labour-time embodied in its product also falls. The variations which are caused thereby within the production group ("cartel") are compensated by revising the Productivity Factor.
The Kautskyian objections to the method of labour-time computation all have their basis in the fact that he can conceive of no possible way in which the concept of average social labour-time can be given a concrete form. This concrete form it receives, however, only when management and administration of production lie in the hands of the producers themselves and are implemented through the Association of Free and Equal Producers.
It was out of the very practice of the revolutionary class struggle itself, which created the system of Workers' Councils as its instrument, that simultaneously the concept of average social labour-time as a concrete formulation was born.
12. Quotation from K. Kautsky: Die proletarische Revolution und ihr Programm, page 319: "The prices of the products, on the other hand, would need to reflect the socially necessary labour... " .
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References
Kautsky is caught here in the confusion of concepts as between "socially necessary labour" and "average social(ly necessary) labour-time". Refer to Note 1 of Chapter 12.return to text
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