We continue our review of Marx’s Introduction to a Critique of Political Economy. As a recap, Marx first treats “production” and sets forth some main ideas about production, in opposition to the classical liberal economists of the day: (1) the isolated hunter-fisher of Smith and Ricardo is not primitive or natural, (2) production is most usefully discussed historically as opposed to as a general economic term, (3) production has two basic principles outside of history (mankind and nature), THEN (4) distribution has two basic principles outside of history (the slave group and the conqueror group), (5) production does not need property to exist and (6) every form of production creates its own legal relations (form of government).
Marx then goes on to his second of three categories in the Introduction, namely the “General Relation of Production to Distribution, Exchange and Consumption.” He begins with an introductory section where he discusses how the economists and their opponents treat production, distribution, exchange and consumption. He then sets forth his view on these concepts in three parts: (1) production = consumption, (2) production and distribution and (3) exchange and circulation. Here, we cover the introductory remarks as well as his treatment of production = consumption.
Marx starts out discussing the “various divisions economists put side by side with production”: distribution, exchange and consumption. He describes the economists’ definition of (1) production, (2) distribution, (3) exchange and (4) consumption, and the economists’ positions on how the 4 concepts relate to each other. First, economists see the 4 concepts chronologically: production as the start; distribution and exchange as the middle; and consumption as the end. Second, economists see the four concepts as subject to different forces: production is subject to universal laws; distribution is subject to society (its laws and rules and to social change); exchange is subject to the individual in a formal social movement; and consumption is subject to the individual but outside the scope of economics.
Thus, economists treat production as general and distribution and exchange as special (consumption is outside the range of economics for them). Production is general, i.e., subject to universal laws; distribution and exchange are special, i.e., subject to arbitrariness or accident. For example, exchange is subject to the individual, thus it is “accidental” in that it depends upon the make-up of the individual engaging in the formal social movement of exchanging. Distribution is special, presumably, because it is subject to social laws which vary across societies and are subject to social change. Consumption, presumably, is the most special of all since it is purely subject to the individual, not rising even to the level of social rules or laws, like distribution, and not qualifying as a formal social movement, like exchange. Hence, it is put outside the scope of economics by the economists.
Marx says the economists’ treatment of the relationship(s) between production, distribution, exchange and consumption just do not go very deep. Neither does he agree with the opponents of the economists. Indeed, he may disagree with them even more. The opponents’ critique the economists on their assumption that production is an end in itself or even that distribution is an end in itself, each to the exclusion of anything else. In doing this, the opponents erroneously (1) assume that production and distribution stand side by side, are self contained and independent of each other; and/or (2) assume that they are engaging in a dialectic balancing of conceptions and not engaging in an analysis of real conditions.
Marx then goes on to analyze real conditions (I will point them out) and set forth why the opponents of the economists are wrong to assume that production and distribution stand side by side, are self contained and independent of each other.
PRODUCTION = CONSUMPTION
Marx’s first main exposition in this part and the whole of what we cover here today is that production is at the same time also consumption. The identity of consumption and production has three aspects: (1) direct identity, (2) mutual interdependence and (3) the finishing effect.
production = consumption
consumption = production
Marx discusses this direct identity from the perspective of consumption. Consumption is two-fold: objective and subjective. When production = consumption, that subjective consumption is like an individual developing his faculties in production and at the same time spending or consuming them in production (a real condition). An individual consumes his faculties while he is producing them. When consumption = production, that objective consumption is consumption of means of production which equals production. Production consumes the means of production while it is producing the product (another real condition). Each is directly its own counterpart. Some more real conditions he cites: in nature, the consumption of elements and chemical matter equals the production of plants. Or, through nutrition, a man produces his own body.
I got to thinking of some real conditions of my own to which this concept could be applied. I remembered back to a time when I was having a hard time at work. I was a new lawyer in a big law firm, probably 3 years in. The gal sitting in the next office was around 5 or 6 years in. She’d heard me crying in my office with my door shut. She offered some advice. She said I was working for myself and getting experience that was mine, that nobody could take away. I was working for them and at the same time I was working for myself; when I worked for them, I was consuming my faculties in production of legal work product; when I was working for myself I was developing my faculties in the practice of law. These two things happened at the same time and they were the same. They were different aspects of the same thing.
Almost as a footnote, he sets forth economists’ interpretation of this double aspect of consumption. When consumption = production (objective or productive consumption), they say it is a second production resulting from the destruction of the product of the first production and call it consumptive production or reproduction. When production = consumption (subjective consumption), they also call it consumptive production. When economists reference reproduction, they use it to point to productive or unproductive labor. When they reference the consumptive production, they use it to point to productive and unproductive consumption. He cites Spinoza’s “determinatio est negatio” (every determination is a negation) to describe the superficiality of the economists’ conception of the identity of production and consumption. Because, production = consumption is more than just a direct identity, there is also mutual interdependence and the finishing effect.
All the sentences in this paragraph are meant to say the exact same thing. Production and consumption are mutually interdependent. Without production, no consumption; without consumption, no production. Production is a means of consumption and consumption is the purpose of production. Production creates the outward object of consumption and consumption creates the inward object of production (the purpose of production, the want). Production and consumption appear to be mutually connected and indispensable yet remain outside of each other.
Marx speaks on the mutual interdependence, at first, in language that production and consumption further the other or produce each other. To better narrate, the mutual interdependence idea, he discusses how production produces consumption and consumption produces production. Production produces consumption by furnishing consumption with its material (its object). He spends more time, however, discussing how consumption produces production. Consumption produces production in that, without consumption, there is no production since production would be without a purpose. Consumption produces production by creating the necessity for new production. It is a prerequisite of production. Consumption provides the ideal object of production. If there are no wants, there is no production. Consumption reproduces the want. Consumption produces production by creating the disposition of the producer and stimulating wants.
Without production of objects, people can’t consume them. But without consumption of objects, people wouldn’t produce them.
The Finishing Touch
Not only are production and consumption mutually interdependent, they also complete or put the finishing touch on each other, as follows. Consumption is an activity through which the product becomes a product. Production both determines the manner of consumption (creates the consumer) and creates incentives for consumption (the moving spring).
Consumption produces production in that it gives production its finishing touch by “annihilating it.” The product first becomes a real product in consumption. For example, a garment does not become a real garment until worn; a dwelling does not become a real dwelling until inhabited; a railroad does not become a real railroad until ridden. A product is not only the material embodiment of activity but also a mere object for an active subject.
I recently had lunch with a friend who does business in China. He told me of mile after mile after mile of enormous apartment buildings around Inner Mongolia sitting absolutely empty. He shows me pictures, each building had hundreds of units, I would say. The demand is supposed to catch up maybe in 5-10 years. An interesting wrinkle to Marx’s take on a product first becoming a real production in consumption.
Production produces consumption by determining the manner of consumption (creating the consumer) and creating in the consumer a want for its products (the moving spring). In terms of determining the manner of consumption, production puts the finishing touch on consumption. The object produced by production is definite and consumed in a definite way according to its production. For example, “hunger is hunger, but the hunger satisfied by eating a meal with a fork and knife is different from the hunger that devours raw meat with the aid of hands, nail and teeth.” The manner of consumption is produced by production. Consumption is created by production objectively (production furnishes the object of consumption) and subjectively (“production . . creates the consumers”).
The creation of the consumer, I love how he starts out simple and builds out layer by layer. This and the next layer are prophetic, I think. This morning I woke up ravenous. There was a fabulous loaf of bread filled fruit filling and covered with danish cheese. I didn’t want to take the time to pull out a knife and slice it but to grasp it with both hands and eat as much as I could directly from the loaf. I paused and reached for the knife drawer. But, Marx’s words starting with “hunger is hunger” struck me. Marx talks about “consumption emerg[ing] from its natural crudeness and directness” and states that
“its continuation in that state would in itself be the result of a production still remaining in a state of natural crudeness.”
However did we go from devouring raw meat with the aid of hands, nail and teeth to a fine dining experience in a french restaurant with multiple courses? If consumption stays in its natural first stage of crudeness is is because production remains in a state of natural crudeness.
Regarding production supplying the material with a want, Marx talks about this in terms of the consumption being furthered by its object as a “moving spring” once consumption emerges from that first stage of natural crudeness and directness. The want is created by appreciation of the product. Marx’s example is that the object of art creates an artistic and beauty-enjoying public. Not only does production produce an object for the individual, it produces an individual for the object. Production creates in consumers a want for its products as objects of consumption. The economists talk about this in terms of supply and demand, object and wants, natural versus social wants.
I think of luxury car commercials and of the opposing concepts of scarcity and plenitude. Many years ago, I remember having a late night argument with a friend. He insisted that he would want to buy a luxury car independently of advertisements for luxury cars. I insisted that he would not even know about luxury cars if it weren’t for the television commercials, leaving aside the behavioral manipulation of the advertising that detracted from the rationality of the individual consumer. I did not win the argument, though I kept all my behavioral economics books.
Consumption Appears as a Factor or Production
Marx then goes on to discuss production-consumption in the individual versus in society in critique of Jean-Baptiste Say’s assertion that society’s or mankind’s production is the same as her consumption. “To consider society as a single individual is . . . a false form of speculative reasoning.” He says that in the individual consumption appears as a factor of production. That is, production-consumption are aspects of one process where production forms the starting point and thus the predominant factor. Consumption, as a want, forms the internal factor of productive activity, but productive activity is the starting point of the realization of the want. Thus, it becomes the predominant factor. An individual produces something, then turns again into himself by consuming it. The individual returns as a product; becomes a self-reproducing individual.
A producer, on the other hand, produces something in society. However, the return of the product to him depends on his relations to other individuals. The producer does not take immediate possession of the product. Direct appropriation does not even constitute his purpose when he produces in society. Between producer and product, distribution steps in and determines by social laws, his share of the products. Thus, distribution steps in between production and consumption.
On this point of an individual producing for himself as opposed to producing for society, Peter Acton recently published a fascinating article comparing the conditions in manufacturing in Classical Athens with those of today brought about by the Information Age.
He then asks “Does distribution form an independent sphere standing side by side with and outside of production?” setting up for his next line of inquiry.