As we saw in the last chapter, one of the greatest followers of Marx, Rosa Luxemburg, could not understand how capitalism could continually expand the value embodied in means of production without producing more goods for consumption. Similarly, these Marxists have not been able to understand how capitalism could possibly benefit from continually expanding the means of destruction. They have been so bemused by the irrationality of what capitalists are doing as to try to deny that this is how the system works.
But such expenditures had enormous implications for capitalism in the latter part of the 20th century. Waste expenditures played a contradictory role. They reduced the amount of surplus value available for productive investment, so counteracting the tendency towards over-rapid accumulation and crisis. But the eventual effect in slowing down accumulation was to create a whole new series of problems for the system, as we will see in Chapter Nine.
Welfare and the supply of labour power
Not all the state expenditures listed earlier fall into the unproductive category as narrowly defined or into the wider category of waste. State-financed research and development (corresponding to category (g) in the list above) that feeds through into aiding accumulation in the wider economy clearly plays a role for those capitals that benefit from it, similar to that of dead labour embodied in means of production. But what of expenditures on health, education and welfare services (equivalent to the expenditures (e) and (f) of individual capitalists) ? Here it is necessary to examine something Marx only discusses in passing-the reproduction of the working class that capitalism needs for exploitation.
The first industrial capitalists of the late 18th and early 1 9th centuries in Britain did not have to worry over much about the supply of labour power. It was available in abundance once "primitive accumulation" had driven sufficient peasants from the land.
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Understanding the System: Marx and Beyond