From the Capitalist Mode of Production to Capitalist Formations: Class Alliances andthe Creation of the World Capitalist System

We know that the Industrial Revolution inj Europe was preceded by an agricultural revolution. We also know that between the ‘feudal’ Middle Ages and the Industrial Revolution there were three centuries of transition, difficult to describe owing to the complexity of their social and economic relations.

Three stages can therefore be distinguished: (1) the stage which we call mercantilism, from the fifteenth to the nineteenth century, characterized by the first transformation of agriculture, its commercialization and the disintegration of feudal production relations; (2) the nineteenth century, characterized by the full development of the capitalist production mode in industry; (3) the twentieth century, characterized by the industrialization of agriculture. Corresponding to each stage, there were different relations between agriculture and other activities (manufacture and trade, later industry). The theory put forward here is as follows: capitalist production relations first appear in the countryside but to a limited degree, owing to opposition from the feudal mode of production. Later, these relations transfer to new areas of activity (i.e., urban industry) where they achieve their mature form, abandoning agriculture. Finally, these relations take a hold over all social life, embracing agriculture in a more comprehensive and profound way. This switching back and forth is characteristic of the history of capitalism’s relations with agriculture in the central capitalist formations.

Let us first look at the first stage, that of mercantilism. During that period the two poles essential for capitalism to achieve its completed stage, i.e., capital and the proletariat, were formed. But they did not actually confront each other until the Industrial Revolution. Capital was still in a prehistoric form, that of accu­mulation of money wealth by the commercial bourgeoisie of Atlantic Western Europe. That bourgeoisie was amassing wealth from its monopoly of the triangular trade and its control of the slave-based export agriculture of the Americas. However, this type of accumulation was not yet different from that of the pre­capitalist long-distance trade: it was merely a monopolistic extortion of slave surplus labor at one end and feudal rent at the other. In the real sense, it was only potential capital. Similar phenomena occurred elsewhere, in other precapitalist civilizations: in the Roman Empire, the Arab world, the Italian and the Hanseatic towns, the Islamized savanna areas of Africa, the seaport areas of southern China, etc.

The other aspect of mercantilism, which is of much more direct interest to us, is the disintegration of feudal relations, the proletarianization and commercialization of agriculture. This is characteristic of Europe during those three centuries, and it subsequently made the mercantilist period appear as a period of transition.

What happened to the feudal mode during that period? What sort of transfor­mations did it undergo? In the feudal mode, the peasant is guaranteed access to land: a member of the village community cannot be driven away or proletarian- ized. Rent (that is, feudal rent, a special form of tribute) is paid in kind—in products and labor. But during those three centuries, first the feudal lords and sometimes some of the peasants became absolute owners of land. There was no longer any superposition of the rights of the two classes.

What did these new absolute landowners (potential capitalist landowners, agrarian bourgeois, and peasants) do with their land? They invested capital in improving the land and sold a part of their output. In the case of former feudal lords or of the new bourgeoisie—derived nobility who had purchased land—rent in kind was replaced by money rent. In addition, land investments left a proportion of the rural population without employment. It was driven away, proletarianized. The people became vagrants, occasionally sold their labor power or were recruited into the king’s armies. In England, this was also the period when people were hanged for theft. Another solution was to emigrate to America.

A market for agricultural products was established, based on the booming urbanization. In the towns could be found the Atlantic trading bourgeoisie, the royal courts and increasingly large centralized administration, the crafts workers who earned their living from this expanding market, and the first manufacturing industries created by the king to supply his army, and his administration.

The appearance of a market for agricultural products meant that henceforth rent circulated. It tended to lose its original characteristic of being unequal and began to even out over the different portions of land. It became, or tended to become, capitalist rent, although this process was not completed until after the Industrial Revolution.

Capitalist production relations and wage labor began to develop. This started in the towns with the development of manufacturing industries, but the process was slow since crafts workers remained organized in guilds, traders did not employ much wage labor except servants, and the administration paid its officials by granting them privileges.

The political economy of mercantilism, or physiocracy, was developed by Quesnay. There can be no political economy to explain the precapitalist modes: the surplus being transparent, there is no mystery to elucidate. Physiocracy is the political economy of the transition to capitalism, this special transition known as European mercantilism: there is already a capitalist surplus in existence (the surplus value in capitalist agriculture and manufacture) and it circulates, but most of it is still located in the rural areas where it is interrelated with the new form of rent. Another example of the political economy of this transitional formation is given in Theorie economique du systeme feodal, by Witold Kula.^[14] Despite its title, it does not deal with a true feudal mode since the Polish feudal demesne of the seventeenth century was highly mercantilized, connected through the Hanseatic towns to Atlantic Europe.

Like long-distance trade, mercantile agriculture was not an exclusively European phenomenon. In the Roman Empire and the Arab world, among others, there were private estates which marketed at least a portion of their products. Money rent, agricultural wage labor, tenant farming, sharecropping, and the absolute ownership of land existed in the Arab world, as is evidenced by the mercantile nature of Islamic law.

However, what was peculiar to Europe was the relation which emerged between the development of the commercial bourgeoisie and the disintegration of feudal relations (the commercialization of agriculture and the appearance of capitalist relations in agriculture).

The industrial revolution opened a new era. After appearing in embryonic form in the rural world, capitalist relations spread to industry where they achieved their completed form. There was money available which could be transformed into capital; the proletariat was also in existence. The handicraft market was too small to cope with the supply of agricultural products, thus a powerful motive appeared for some craftsmen to invent the first machines. Of course, the new industrial capitalist class did not necessarily derive from the former commercial bourgeoisie. The latter generally allowed itself to be absorbed by the system: it purchased lands or patents of nobility. The newly enriched peasant or the gentleman farmer, the financial adventurer or the court and army supplier grabbed the money accumu­lated elsewhere and set up new industries.

This industrial revolution took place through the alliance between the new bourgeoisie and the landowners.

Whatever form this alliance took, its cost involved the extraction of a part of the surplus value in favor of the landowners. We can now refer to capitalist rent in the full sense of the term since it is retained from surplus value. The mechanism resulted in high prices for the basic necessities and hence in larger expenditure on wages and reduced profits for the capitalists. These high prices of basic necessities were simply a continuation of the prices prevailing in the transition period. In turn, this landownership monopoly freed its beneficiaries from the constant obligation to improve their production techniques, under the pressure of competition, from which no industrialist could escape. Thus the gulf widened between the modern­ization of industry and the comparative stagnation in agriculture.

The agricultural sector supplied the towns with their basic food requirements and raw materials for which, in return, it received manufactured consumer goods rather than production goods as during the mercantilist transition period. The relations were fairly evenly balanced.^[15]

This autonomy of rural society—autonomy and not autarky—hindered the development of capital. It is obvious that rent was not a category of the capitalist mode and that it slowed down the accumulation of capital. Ricardo had already perceived it as the source of a bottleneck which John Stuart Mill was later to express in very precise terms.

This is why capital attempted to reduce progressively this drain on the economy which rent represented. How? Land nationalization was certainly the most radical way. This is why Lenin regarded it not as a socialist reform but as a revolutionary bourgeois reform. The measures taken toward municipal ownership of urban lands in the most advanced social democracies were a step in that direction.

The third phase opened with the industrialization of agriculture which was henceforth to supply an increased number of products to the towns but, in return, was to receive not only manufactured consumer goods but also agricultural inputs (fertilizer, equipment, power). This phase took particularly varied forms since it started at a time when a world system was already being set up under the wing of monopoly capital. Reduction in rent was therefore being achieved by changing the internal and external class alliances. Consequently the agricultural sector of the periphery was becoming integrated and dominated by capitalism. But before dealing with this decisive question, it is useful to look into the debates in the socialist movement concerning the development of capitalism in agriculture.

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