Thursday, April 05, 2012

The collective nature of production versus the individual nature of businesses

Something that Marx talked about that bears repeating. The idea that modern industrial production is getting to be more and more collective came from observing what advances in technique had lead to in contrast to traditional, craft based, production. Adam Smith's idea of the increasing division of labor fit the explanatory bill perfectly: instead of one person doing all the work in assembling and manufacturing a single product, that work was now being spread across the hands of many people, with new jobs and positions being opened up that only did the work of a particular phase of manufacture. That situation has become so commonplace that these days folks don't realize it wasn't always the case.

Think of the effort that goes into making a new line of shoes for Nike, for instance. You have all the design done collectively by different groups of people focussing on different aspects of it, and you have the manufacture, that is broken down into specific tasks for people in the third world to do on a mass production, likely assembly line, basis. Shipping back to the U.S. is included in the work, as well as the communication and coordination between the U.S. and the factories oversea. Look at how different that is from a cobbler working in a village making pairs of shoes by hand. It's a massive, collective, enterprise that employs thousands of people.

Yet despite the collective effort, all of the ownership and control belongs to one or two companies, to Nike and to the company overseas that makes the shoes. These are reported to be individual contractors as opposed to actual parts of Nike itself. Everyone who works for the companies are included under the umbrella of the corporation, either as hourly, salary, or slave workers, in this case. The problem raised by Marx and others is that if this massive, collective enterprise is being run by many people and many groups of workers acting in cooperation, why is it that they themselves don't own and control, the companies?

*on edit: I should also say that modern corporations act like huge contractors or agents, with an executive level that's in charge contracting down other people to do the work of the company. This is in keeping with the origin of modern manufacturing businesses, in that they were started by merchants who made exclusive contracts with particular artisans to make goods for them, to be sold in whatever way and at whatever price the merchant decided. Eventually, the merchants, who were the ancestors of the modern executive level of businesses, bought the means of production, the tools that folks used to make goods, and employed the artisans as out and out employees instead of individual contractors, leading to modern business capitalism today, in its many forms.

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