Chandler,Alfred D.. Strategy and Structure: Chapters in the History of the Industrial Enterprise. Cambridge, MA: The M.I.T. Press, 1962.

Alfred D. Chandler has written a lucid, interesting, and informative work about the history of organization and industry in the United States since the late nineteenth century. Chandler’s thesis is that in the development of American business, structure (the organization of a business entity in order to carry out its current functions) follows strategy (the long term plan for change in the organization’s activities in order to continue to participate in the market over time.). In order to make the case that this has historically been so, Chandler provides case studies of four major U.S. Corporations whose organizational innovations were at the forefront of the creation of the modern multi-divisional decentralized corporate structure. All four, Chandler asserts, became to some degree models for other expanding corporations after World War II as American business spread overseas, and into new product lines and markets.

Chandler begins his history with the context of the changes these four corporations underwent. In the first chapter, Chandler gives a summary explanation of the development of administrative structure in American business. Before 1850, he says, American business was usually a family or small shop affair, and little future planning was necessary. Business usually involved an owner doing both planning and working within the business on daily operations. After 1850, a few businesses did begin to develop administrative structures, but these structures continued to reflect the operational, rather than strategic needs of the business.

As Chandler warms to his subject, though, he opens up one of the key concepts in his thesis – that the expansion of a business enterprise dictates the need for new structure. The primary example that Chandler uses here is the development of railroads, whose extension to farther-flung locations required ever more careful coordination of operational activities, and for whom the growing market, defined by the expansion of the American frontier, required strategic planning in order to find profitable routes, and sufficient financing. This expansion led to the creation by the railroads of an organizational model that included a central administrative office which controlled a number of departments whose responsibilities were divided by function.[1] This centralized departmental structure served large and growing enterprises well until the end of the first decade of the twentieth century. At that point, Chandler says growth became a major issue for several of the largest corporations in America.

Chandler also explains that growth can come in a four different ways: growth from continued expansion of the same business with the same type of customers; growth from vertical integration; growth from expansion to overseas markets; and growth from expansion into new product lines. It is also true that enterprises might be growing in two or more of these ways at once. Yet the most important, from the perspective of requiring new organizational patterns, is the last – growth from expansion into new product lines.[2] Chander’s goal is to show how this growth led to a new model for American business organization.

The four firms studied by Chandler: du Pont, General Motors, Standard Oil, and Sears, Roebuck and Co. all found that to make their diversified and complex businesses work, and to continue to work into the future, they had to reorganize. Each seems to have developed a “decentralized, multi-divisional structure” independently of the others, by different paths, and for somewhat different reasons, but ultimately ending up with a similar structure in which the general administrative office is in charge of planning and distributing (particularly financial) resources, and the divisions each work as multi-departmental companies in charge of a specific part of the business, with the divisions created based on the business needs.[3]

The largest section of the book is made up of Chandler’s four case studies. Among these, he takes care to note differences in enterprise, market, and style. He begins with the earliest corporation to become decentralized and multi-divisional, du Pont Chemical, and ends with the last, Sears, Roebuck and Co.

Du Pont, specialized in explosives manufacture for sale mostly to the United States Government. The downturn in this market after World War I, however, forced DuPont to diversify into chemical products for industrial, agricultural, and domestic use among consumers and businesses. The success of the company in doing this eventually caused so much stress in the central administrative office, which was organized around functional departments before 1921, that the administrators of the company, mostly concerned with daily operational tasks in any case, had little or no ability to understand what was going on over the entire company. In other words, du Pont’s conscious decision to change its approach to the market through diversification, a new strategy, caused a serious workload problem, particularly for administrators, and this required the development of a new structure – a decentralized multi-divisional organization that allowed central planning and control of resources, while the divisions themselves were able to autonomously work within their own markets at an operational level. This provided maximum operational efficiency and the best flexibility possible to react to changing market conditions. As Chandler says, “At du Pont, then, structure followed strategy.”[4]

The change at General Motors from a centralized, departmental structure to a decentralized multi-divisional structure came from the opposite impetus. General Motors did not require the creation of a set of autonomous divisions to serve a diversifying product line. Rather, General Motors was already diversified to a point where central control was becoming impossible, and so the reorganization there came from the creation of a general office.[5] The strategy of William C. Durant, who created the General Motors Corporation, was from the beginning big. He was already by 1908 the largest auto manufacturer in the nation. That very size left GM difficult to manage because communications were poor, and financing was difficult. In 1920, GM’s new President, ironically Pierre du Pont, implemented a multi-divisional organization plan created by Alfred P. Sloan, Jr.[6] That plan placed a general office at the center of a vast multi-divisional corporation whose divisions were based on brand and product. These divisions were each responsible for manufacturing and marketing their own products, and for reporting back to the general office regarding finances, sales, and other key information.[7] In return, the general office would take the information from those reports, and plan market and manufacturing strategy. Once again, structure followed strategy.

The third enterprise that Chandler discusses is the Standard Oil Corporation (New Jersey), or what he calls “Jersey Standard”. Here, the fact that the enterprise was primarily a refining company after being required to make major divestments in accord with a Sherman Anti-Trust Act decision by the Supreme Court in 1911 was one of the key issues. Chandler explains that while Standard Oil continued to be a refiner of oil, staying with basically the same business, expansion of the market as the automobile became popular drove a need to secure downstream resources and upstream distribution – a drive for vertical integration in a growing market. Thus, the “Jersey Company” grew based on “responses to immediate short-term pressures in the marketing, refining, and producing of oil…” – operational concerns created a tension in administrative work, because the company was moving from crisis to crisis with little or no strategy.[8] In 1925, an inventory crisis made the organizational problem impossible to ignore, and after a series of organizational failures, the Jersey Company became a decentralized, multi-divisional organization, like du Pont and General Motors, though in a much less deliberate fashion. Still, Chandler’s point is that structure follows strategy – the crisis in administration required better planning, accounting, and resource distribution. Answering that strategic need with a new organizational structure that fit the growth needs of the company was the solution.

Sear, Roebuck and Co. was again different from the other three companies in Chandler’s study. First of all, Sears was a mail order company which had decided to expand into over-the-counter retail operations. Its function was essentially the same, but it was enlarging and decentralizing its distribution network.[9] Early responses to the growth problem led Sears into a hybrid organization, in which half the organization was of the older functional model, and half was based on territory.[10] By 1940, it was clear that a territorially delineated structure of multifunction divisions, linked by a centralized general office in Chicago was the most effective structure. Sears then went about defining the administrative roles of managers within the central office.[11] Once again, then, structure followed strategy in the case of Sears.

Chandler spends his penultimate chapter comparing these four companies, concluding that while they all realized the need for a new organization after experiencing different kinds of growth, and different types of problems related to that growth, they all also came to organizational change because of the perceptions of effective managers whose work was affected by the difficulties inherent in the older organization systems under the strain of growth. In the end, despite different product lines and business trajectories, all found that the decentralized, multi-divisional structure was the most efficient organization for dealing with operational realities, while providing information, planning, and financing functions that helped to be flexible and reactive to market realities.

In the end, Chandler wants his readers to recognize a broad arc of business organizational development in U.S. History, beginning with the realities of family and shop-size firms concerned with local, single- or limited-product-line production, and which were primarily operational in organization, sparing little time for strategic adjustment to new market realities. His arc continues through the development of larger transportation and manufacturing, through the development of railroads and broad distribution networks and the advent of machine manufacturing, through which enterprises needed to become more carefully organized in order to continue to deal effectively with growing size and distance. The administrators of these second-generation firms were still primarily concerned with operational matters.

Chandler sees a paradigm shift with the development of large firms with centralized functional departmental structures, capable of handling marketing, manufacturing, finance, procurement, and service under a single roof efficiently. This, too, though, eventually became insufficient for the growth of the largest corporations in American history during the end of the nineteenth century and the first part of the twentieth century. The backups, logjams, and structural problems these firms experienced led them to understand a need for efficient sharing of information and use of that information to efficiently distribute resources and plan for future market moves. This need could only be answered, by the decentralized multi-divisional structure that the four companies in his study represent.

In all, Chandler’s book is very useful for creating a framework for understanding the development of big business in the United States, particularly over the course of the twentieth century. The broad arc of business history that he paints does not spend much time with earlier forms of organization, stopping mostly with the statement that these were mostly operationally oriented and spent little time on planning. The focus on the twentieth century, though, and on big business, does occasionally lead a reader to wonder where all of the other enterprises are in this arc of history. Never the less, Strategy and Structure is a critical work necessary for anyone wishing to really begin to understand the development of American business.

As I read through Karl Marx’s Capital, Vol. I a second time, I noted a number of general ideas that stood out more clearly than they had the first time through. These included Marx’s clear use of terminology to support his observations, the concepts revolving around the definition of “the Working Day,” the discussion of growing worker dependence upon machinery, and interpretations of the struggle for better wages. Capital also has come to seem to have a kind of double quality.

Marx was writing about his own time as if he were a journalist, but at the same time, so many of Marx’s ideas and complaints are relevant to debates about business and labor in our own time. Clearly Marx’s definition of capital is far deeper and broader than I had ever imagined, and so much a part of my own understanding, not only of economics, but of social and political realities in my own world, that I have come to see this book as marking what Michel Foucault has called an “epistemic shift”: a change in the general understanding of how society functions that is so great that those who live within it cannot imagine how earlier worldviews might have functioned. I got the sense that Marx and I were talking about the same reality, and that it was a reality neither of us would share with someone from the century before Marx.

In the second reading, not looking for the Marx of the Communist Manifesto, I was able to read Marx as a social critic, an academic, and a journalist examining important events in his own time. This lack of expectation of the political allowed me to see the analysis taking place in the text, and I found myself trying harder to understand the terminology that Marx presented. His writing is really quite easy to read, and he presents terms which he defines clearly in order to create a clear foundation for the observations he makes about society. His specific definitions, for example, of the terms “means of production,” “implements of production,” “labour,” and “capital” make his work very accessible. I had never understood to the degree I do now how all of this fits together. With a clear understanding of these terms, I am both more able to criticize Marx, and to read critically those who have used or referred to Marx in their own later work. The second reading was useful for this purpose alone.[1]

In another example of Marx’s clear use of technology, but with even greater implications, I was very interested to learn Marx’s definition of “raw materials” not as the most basic materials removed from nature for manufacturing, but as the means of production which have already been changed through the process of labor. In other words, every manufacturing system creates new value out of “use-values” that themselves were products of the labor process. This helped me to better understand the idea that once a product is finished, the labor and means of production that went into it are eradicated, and only the value of the manufactured item remains, to be used again in the next process of creating surplus value. This is a complex set of ideas, but ultimately, it means that the process of production is always removed from nature by at least one degree, and usually more. This seems to be another kind of alienation – if one of the characteristics of capitalism is the alienation of the worker from the product, another is the alienation of the product from nature.[2]

The section concerning “The Working Day” had presented a number of problems for me the first time around. The concept of surplus value as a function of surplus labor was extremely difficult to comprehend. I came to understand this as including what we today call ‘productivity’ after the second reading. I understood the historical context of the issue by reading the evidence Marx presents, and came to recognize that the wage structure differed from the hourly wages of factory workers today. This means that Marx’s discussion of the way in which factories extended the time that workers labored in the factories on a daily basis has to be translated into our own productivity conceptions. To do this is very difficult because the daily wage structure Marx was confronting was far simpler, and perhaps easier to subvert, than our own structures today. It was the examples that Marx gave to support his ideas, and the evidence he provided, that helped me begin to see the process of working toward hourly wages, and made me wonder where I might find further information on the goals of labor reform in order to discover if the hourly wage came to be in response to the abuses of other wage structures by factory owners. The effect of this was to make me see the vast spaces open for analysis of wage and management structures in terms of the way they exploit labor and force increases in productivity – I was able to understand the appeal and analytical power of Marx’s ideas, and why they might have such impact on the field of historical analysis. I also developed a great interest in labor history here.[3]

Marx’s discussion in Capital of the nature of the wage struggles of his own time clearly shows the roots of later analysis of labor and business. Marx says that these wage struggles are a part of the manufacturing system as it has come to exist, and not in opposition to it.[4] This reads as a kind of foreshadowing of the 20th century argument about the admissibility and efficacy of labor unions in the economies of the belligerents in World War I, and the post- World War II economies of Europe, Japan, and the United States, in which labor unions are defined as ways to work for equity within the existing manufacturing system, rather than attempts to destroy it.[5]

Marx was already interested in this question when he published vol. I of Capital in 1867. I find this fascinating in the sense that it seems that Marx is talking about an economy and a society that I can understand and relate to in the United States of the twenty-first century. While the size, organizational structure, level of automation, and degree of capitalization has changed dramatically, the economy Marx is discussing, almost journalistically as existing in his own time is very much like the economy of our time. In a sense, we share a reality with Marx that I don’t think we share with people of the 16th century, for example. Mill, Smith, and Ricardo were also talking about ideas and realities that, while different, are recognizable and understandable to people living in today’s economy. It therefore occurred to me as I read that Capital is one marker that an epistemic shift – a change in understanding that removes clear access to earlier ways of understanding the world – had occurred by the mid 19th century in industrial societies.

There are many other examples of ways in which Capital seems to mark an epistemic shift. The way in which Marx foreshadows the ideas that eventually became “scientific management” in twentieth-century America is uncanny. For example, he wrote that “[the] technical subordination of the worker to the uniform motion of the instrument of labour…gives rise to a barrack-like discipline…thereby dividing the workers into manual laborers and overseers, into the private soldiers and N.C.O.s of an industrial army,” and that while an individual craftsman makes use of tools, “in the factory, the machine makes use of him.”[6] Both of these passages make it clear that Marx was looking at the way that the process of manufacturing on a large scale is driven more by the needs of the machines than by the workers who operate them. This has overtones of the redesigned Ford Motor Co. factories in the second decade of the twentieth century, where worker action and machine needs were integrated in such a way as to make the workers a part of the machinery, and to create an atmosphere in which human working patterns were subordinated to the working patterns of the machines.

In all a second reading of Capital was rewarding. I know that I understand Marx better now than I ever have, and look forward to reading further.

Marx, Karl. Capital: A Critique of Political Economy. Penguin ed. 3 vols. Vol. 1. New York: Penguin Books, 1867, 1976. Reprint, 1976.

Zinn, Howard. A People’s History of the United States. New York: HarperCollins, 2001.

Marx, Karl. Capital: A Critique of Political Economy. Penguin ed. 3 vols. Vol. 1. New York: Penguin Books, 1848, 1976. Reprint, 1976.

For my first project this semester, I read sections of Volume I of Karl Marx’s Capital. This paper consists of a selection of notes that I have taken on the reading, then edited, along with my reactions to the ideas and evidence presented in the book. I found this book to be interesting, and not as difficult to read as I expected, but very densely packed with ideas and evidence. I suspect I’ll be reading and re-reading it for years. My initial observations seem to me to be somewhat superficial – I found nothing particularly difficult to understand or overly subtle in the points Marx makes, but I was impressed by the insightful observations, and the way in which they can still be applied to the history of labor and industry. The sections I read include chapter 7: “The Labor Process and the Valorization Process,” Chapter 10: “The Working Day,” chapter 15: “Machinery and Large Scale Industry,” chapter 26: “Primitive Accumulation,” and chapter 27: “The Expropriation of the Agricultural Population from the Land,”

In “Chapter 7: The Labour Process and the Valorization Process”, Marx tries to relate labor power to its place in the capitalist system by explaining that labor is a commodity – a process by which raw materials are turned into what Marx calls a “use-value” – a commodity that satisfies some need, and is therefore marketable.[1] The capitalist controls the production because he has purchased the raw materials, and the location of the work, with his capital. According to Marx, he then goes out and purchases labor on the open market with his capital, as a commodity, but one whose role is to transform the other commodities – the raw materials, into a use-value that he can then sell to increase his capital.[2]

However, Marx in this chapter explains that the key problem here is that the capitalist is not interested in producing just anything, nor is he interested in producing use-values that for his own use. The interest of the capitalist is to increase his capital by engaging in the production process. Therefore, he needs to find some way to increase the value of the goods produce. According to Marx, raw materials have an intrinsic value which cannot be altered, unless the material is itself altered to meet a specific need. The process of alteration, then, the labor process, is also the only place where value can be added to goods. However, as the labor process is itself only a commodity, and has, therefore, an intrinsic value – namely, what is required for the laborer to survive, then the capitalist can make no money on this process, unless he finds a way to increase value without increasing cost. This can be done, according to Marx, by increasing labor productivity without increasing its cost.

Marx says that a laborer can sell his labor power – defined as the potential to effect change in raw materials through the process of work – at market value. The capitalist, though can pay the laborer the cost of subsistence, and if the laborer produces enough goods to return than cost in four hours, the capitalist can insist that he will pay the same amount, but only for six hours’ work. In this way, the capitalist gets more for his money than the actual cost of the labor power, thus allowing him to realize a profit on the goods produced.

I found this interesting, but rather limited. It certainly brought home to me some of the realities of labor in Marx’s day. Obviously, ideas such as extra pay for over time work were not in practice at the time. It also makes me wonder to what degree modern wages are based on this same principle.

However, it also seems quite limited in its understanding of the production process and the process of the market. It places all surplus value within the envelope of labor, and gives no account for other market forces such as demand, the relative and changing value of commodities, and the degree to which commodities as raw materials are or are not renewable. Marx also seems to assume that laborers are only interested in subsistence-level life. This seems a narrow view, and I wonder to what degree it is informed by the times, and to what degree Marx is assuming a limit to the intelligence or desires of laborers themselves.

In “Chapter 10: The Working Day”, Marx seems to have several goals. The first goal is to elaborate on the ideas of the relation between capital and labor that he discussed in Chapter 7.[3]

His longest argument, though, is a historical narrative of the process by which laborers were able to shorten the length of the working day, and how in many cases the legislation that accompanied worker attempts to limit work time actually worked in reverse, giving capitalists legal permission to use workers for certain lengths of time, rather than limiting their rights to equalize their market power with that of workers. This, he wants to claim, only becomes a struggle when those selling labor on the market come together to demand certain rules in the process of the sale of labor – and groups of capitalists come together to protect their own interests – what Marx calls, “a struggle between collective capital, i.e. the class of capitalists, and collective labor, i.e. the working class.”[4]

The history Marx gives begins much earlier than the Industrial Revolution, and seemed to me to be the foundational arguments for the historical dialectic that Marx and Engels discuss in the Communist Manifesto. He begins with a brief description of the abuses of laborers by pre-industrial systems, and makes a connection to his theory of the valorization of capital by showing how in Medieval Europe, and Russia, by example, aristocrats essentially accomplished the same over exploitation of labor power by providing serfs and peasants on their farms with contracts and laws that required huge amounts of work, and allowed the workers only the time necessary to subsist. By holding on to the means of production – the raw materials and place, and tools, of production, these landlords and aristocrats were able to command tremendous extra labor with the potential threat of removing all means of production.

However, the critical factor in making labor into the commodity that he sees in his industrial era is money. Money, capital, is the means by which labor and other commodities are purchased, but, as Marx explains, they are purchased by the capitalist not for themselves, and not even for the use-value of the goods they produce, but because the capitalist believes he can sell that use-value for more money – what Marx calls “exchange value”. He says in this chapter that so long as a political economy works to produce use-value, and not exchange value, the horrifying drive for surplus labor will not arise.[5] I disagree. It seems that there is plenty of evidence of horrific overexploitation of laborers in Europe’s middle ages. However, I see what Marx is driving at here – he wants to show that the primary difference between a commodity economy and a capitalist economy is the form of exchange, and when we apply money to the process of exchange it is possible to see changes in value for commodities that might otherwise always operate in the market based on their intrinsic value. This is apparently Marx’s definition of capitalism. While it has its flaws, it seems to me to be a good place to begin. In fact, Marx seems to be somewhat cognizant of my own objection above in that he also mentions that in the non-exchange economies, overexploitation of surplus labor did occur in the mining of precious metals – gold and silver – which were the monetary medium of exchange at the time, and so prefigured, or imitated, capital.

This historical narrative stretches as Marx gets into his stride and begins discussing the early 19th century legislation in England meant to reduce the working day for laborers. He goes into dramatic detail, providing some useful and interesting facts and figures about the difficulties of laborers, child labor time statistics, and even interviews with laborers and capitalists of the time regarding their thinking about the length of the working day. His primary point, particularly with his discussion of the English Factory Act of 1833, is that the legal limiting of the working day to 12 hours was interpreted by factory owners as both an obstacle to be got round, and a legal permission to require work for 12 hours. This is well above the limits to the working day established even as early as the 14th century.<!–[if supportFields]> ADDIN EN.CITE &lt;EndNote&gt;&lt;Cite&gt;&lt;Author&gt;Marx&lt;/Author&gt;&lt;Year&gt;1848, 1976&lt;/Year&gt;&lt;RecNum&gt;97&lt;/RecNum&gt;&lt;Pages&gt;283-306`, 340-416`, 492-588&lt;/Pages&gt;&lt;record&gt;&lt;rec-number&gt;97&lt;/rec-number&gt;&lt;foreign-keys&gt;&lt;key app="EN" db-id="ss2sdrze49zp0aeavt4v0efj0zpwwvr5wrra"&gt;97&lt;/key&gt;&lt;/foreign-keys&gt;&lt;ref-type name="Book"&gt;6&lt;/ref-type&gt;&lt;contributors&gt;&lt;authors&gt;&lt;author&gt;Karl Marx&lt;/author&gt;&lt;/authors&gt;&lt;/contributors&gt;&lt;titles&gt;&lt;title&gt;Capital: A Critique of Political Economy&lt;/title&gt;&lt;/titles&gt;&lt;volume&gt;1&lt;/volume&gt;&lt;num-vols&gt;3&lt;/num-vols&gt;&lt;edition&gt;Penguin&lt;/edition&gt;&lt;reprint-edition&gt;1976&lt;/reprint-edition&gt;&lt;dates&gt;&lt;year&gt;1848, 1976&lt;/year&gt;&lt;/dates&gt;&lt;pub-location&gt;New York&lt;/pub-location&gt;&lt;publisher&gt;Penguin Books&lt;/publisher&gt;&lt;urls&gt;&lt;/urls&gt;&lt;/record&gt;&lt;/Cite&gt;&lt;/EndNote&gt;&lt;![endif]–><!–[if supportFields]>&lt;![endif]–>[6]

Along with his evidence of child labor, and exceedingly long labor hours even for adults, and his acid castigation of the arguments presented by capitalists, Marx surprised me by claiming that because this is a collective problem, individual capitalists were as much captured by the system as individual laborers were. He says on page 382, “Under free competition, the immanent laws of capitalist production confront the individual capitalist as a coercive force external to him.”[7]

In Chapter 15: Machinery and Large Scale Industry, Marx elaborates on some of the labor and mechanization themes from his earlier chapters. He explains how the application of machines to large scale manufacturing is really a process of increasing labor productivity by replacing laborers with machines.

Marx begins this chapter with an idea that surprised me, and yet made sense. He says that the aim of machinery is not to “[lighten] the day’s toil of any human being,” but that “machinery is intended to cheapen commodities and, by shortening the part of the working day in which the worker works for himself, to lengthen the other part, the part he gives to the capitalist for nothing.”[8] From the point of view given in chapters 7 and 10, with the idea that capital gains only through the exploitation of surplus labor, this would seem to be the obvious view of the purpose of machinery.

What Marx does next I also found interesting. He takes issue with the definition of the word “Machine” because the technical definition which identifies a machine as a complex tool, and in which a machine is considered to be a tool powered by other than human hands, he says, are both insufficient in that they do not take history into account. Marx chooses to replace these definitions with one that both suits the Industrial Revolution, and his own argument: “The machine,” he says, ” is a mechanism that, after being set in motion, performs with its tools the same operations as the worker formerly did with similar tools.”[9] I found this interesting not only because it redefines machines in a way that I am not familiar with, but because it seems to call up such historical phenomena as the Luddite machine breakers of the period before and during Marx’s writing of Capital. I was again surprised by the degree to which this book is of its time, as well as the degree to which it is relevant to understanding capitalism in the 20^th and 21^st centuries.

In the same way, I am very interested in Marx’s view that the steam engine did not constitute the Industrial Revolution, but the machines that required the steam engine as motive power did. In other words, for Marx, the Industrial Revolution was not about machinery and power per se, but instead about the revolutions in productivity that machines and the application of motive power to them could create. This reflects my own view, but is so well put in this case that ideas I have had about the nature of industry and capitalism are clarified by it. In fact, I get a distinct impression that every history I have ever read of the Industrial Revolution is primarily informed by Marx’s view of it. If this is the case, nearly all that Americans learn about the Industrial Revolution must be to some degree Marxist history. I have for a long time been aware that Marx’s influence here was heavy, but this makes me recognize that his views are the prevalent ones, even today, in textbooks and general histories.

Perhaps what surprised me most about this chapter is Marx’s discussion of the effects of massive automation. As he says, “[as] soon as a machine executes, without man’s help, all the movements required to elaborate the raw material, and needs only supplementary assistance from the worker, we have an automatic system of machinery, capable of constant improvement in its details.”[10] This seems like only a few steps away from 20^th century idea of “Scientific Management” – the Ford Motor Co style of production in which the machinery, rather than the workers, dictates how workers go about their work – the workers become a part of the machine.

In his discussion of examples of large scale manufacturing, Marx seems less prescient, and much more impressed simply with the scale of the factories he is describint, so it seems that he did not make the leap himself to the idea of worker as part of the machine, but instead rested with the idea of workers becoming superfluous. Still, the short intellectual distance from Marx’s description to the ideas of Scientific Management impressed me very much.

In Chapter 26, Marx finally comes around to answering a question that I have often thought of myself. I am not fully satisfied with Marx’s answer, but it is useful. Marx here points out the central problem that seems so vexing about the growth of capital and industry – namely, that the production of surplus value requires surplus value to begin with as investment capital. This means that in some way prior to the advent of capitalism, as Marx has described it, there must have been some spare capital accumulation already occurring. Marx calls this “Primitive Accumulation.”[11]

I was put off by Marx’s discussion about what he calls the fairy tale that “primitive accumulation plays approximately the same role in political economy as original sin does in theology.”[12] He discusses the idea of the existence of an economic Adam and Eve – early people who were frugal, and early people who were not. Quite rightly, I think, he dismisses this as a fairy tale, told by those who have wealth in order to explain themselves. However, he goes on to give an explanation that is not much more satsifying – he divides even the earliest societies into groups who own the means of production – the resources – and those who own and sell their labor but are “free from…any means of production of their own.”[13] While I still think that this is within the context of the historical place and time that Marx was writing, during which much less was known about early human societies, it is disappointing as a set of assumptions with no evidence or explanation – no more clear than the ideas of the State of Nature set forward in the previous century by John Locke and Thomas Hobbes. This seems really to be an extension of his ideas backward in time to support their scientific reality, but they rest on a claim that is not scientific at all. This is quite different from the earlier sections of the book that I read, where nearly every statement had evidence behind it, almost in a journalistic fashion.

Perhaps my own discontent here comes from the fact that there is much more knowledge about the transition not only from agriculture to industry, but from pre-agricultural to agricultural societies, and where Marx is content to assume that agricultural societies show that humans have always shown the division between labor and the means of production that he is interested in, today we have reason to believe that such a division of labor was not necessarily the case – that this is not a human State of Nature. This reaction is, on my part, somewhat unhistorical, since I cannot ask of the historical Marx an understanding of history that was not yet available to anyone in his time. Still, it does speak to the viability of at least some of his ideas. I think it is a valid critique of the theory, if not of the historian.

I was, though, most interested to read “Chapter 27: The Expropriation of the Agricultural Population from the Land,” as this was the link to social class in the historical dialectic that I have always been curious about. Marx’s inclusion of peasants, and even of wage laborers, in the class of “free peasant propietors” – in effect, if not in feudal legal terms, real landholders who made a living from the working of their own soil – was quite a surprise for me. This realization will force me to rethink my own understanding of the process of the historical dialectic and the creation of the industrial working class. Marx seems to make a distinction here between what he calls “absolute ownership” – which is a kind of de-facto possession and use of land, and legal land ownership, which rested with landlords and the upper class. More than I have ever understood, then, for Marx, it is labor for another who possesses all the means of productioon, rather than for oneself, that constitutes membership in the working class.[14]

Marx here showed me how very important the process of enclosure was, beginning in the 15th century. As I mentioned earlier in these notes, it strikes me now how very important Marx’s interpretation of these events, and even his choice of the evidence, has been in the writing of the history of industry and capital since. Still, I had thought of enclosure and subsidiary event, hastening the growth of the working class, but not playing the central role that Marx gives it, along with the expropriation of Church property during the Reformation. The connection, as Marx makes it, seems to clearly support his argument of the creation of a laboring class through the process of expropriation of the means of production. This is much more convincing than the previous chapter. I can be more easily convinced that these events could create a class of people who no longer control any means of production, and are therefore forced to sell their labor in order to subsist.

In general, having read only portions of Capital, vol. I, I understand much more clearly the arguments Marx made, and am far more capable both of seeing how those arguments are reified or reversed in more recent historiography, and in analyzing the way capital and labor are intertwined throughout history. I have always wanted to read this book, and I must say, despite numerous critiques I have, it did not disappoint.