THE SCIENTIFIC AND TECHNOLOGICAL REVOLUTION AND THE EXPANSION OF THE ECONOMIC BOUNDARIES OF SOCIAL WEALTH

V. S. Feshchenko

Wealth is one of the first economic categories. The beginning of its study dates to the period of the formation of the capitalist mode of production and the emergence of economic knowledge as an independent branch of science. Even today, wealth remains one of the most general indicators of the comparative economic power and productive capacities of various countries.

The question of defining the concept of wealth remains controversial. A scientific approach requires a clear identification of the boundaries and sphere of application of this category. Depending on the resolution of this question, practical measures for the accounting and planning of national wealth must also be substantiated.

The scale of development of the productive forces under the conditions of the scientific and technological revolution complicates the economic structure of society. Science and education are becoming independent spheres of social activity, and expenditures on their development are growing at an outstripping pace. The tendency toward the accelerating involvement of natural resources in the sphere of material production is becoming clearly evident; the needs of a developing economy have hastened the posing of the question of their quantitative assessment.

The expansion of the sphere of society’s economic activity cannot fail to affect the content of such a general, synthesizing category as social wealth. The impression is created that wealth is not only increasing quantitatively, but that its economic boundaries are also expanding: new elements are appearing, and the concept is becoming more complex. The prolonged discussion among economists on the question of defining the concept of wealth, in our view, reflects this tendency.

In the economic literature one encounters various definitions of social wealth. A number of economists regard as national wealth only the accumulated material goods created by human labor.

The most widespread definition has been the one according to which social wealth should include the stock of material goods created as a result of previous labor, as well as natural resources. This definition was actively defended by M. V. Kolganov and is given in a number of textbooks on political economy.

Finally, there also exists a third point of view. Its supporters include in wealth not only material goods and natural resources, but also the accumulated productive experience of the working people. Dol-

at that time this was the broadest interpretation of the composition of wealth among all those found in our literature.

The first step in this direction was taken by S. G. Strumilin. As early as 1935 he wrote: “The practice of the start-up period of new Soviet enterprises has shown us that, irrespective of the material framework of the new technology, at these enterprises, in order to master it, it is still necessary to accumulate a considerable non-material fund of production experience and technical skills among the workers, without which even the best technology loses its value.”¹

The appearance in 1955 of G. N. Freimund’s work Essays on the Statistics of National Wealth provoked a lively discussion. The idea advanced by the author—that production experience and knowledge should be included in national wealth—was at first subjected to merciless condemnation,² but in recent times has been finding ever more supporters.³

In recent years new directions have emerged in the development of the theory of wealth. This is connected with the elaboration of many problems brought to life by the high level of economic development and by the scientific and technological revolution.

Since the mid-1960s, in the pages of the journal World Economy and International Relations, a number of authors have actively defended the proposal to introduce into economic analysis the concept of “non-material forms of wealth and services.”⁴ Thus, the expanded interpretation of the category of wealth proposed by E. N. Freimund was supplemented by the inclusion within wealth of the product of the service sphere.

The scientific merit of E. Freimund consists in the fact that many of the propositions she advanced anticipated contemporary discussions. Thus, the impossibility of identifying a value estimate for natural resources was regarded by many economists as an additional argument against including them in social wealth. Expressing the views of this group of economists, A. L. Vainshtein, the author of a fundamental monograph on national wealth, wrote in 1960: “E. Freimund believes, contrary to the opinion of the majority of prominent Soviet statisticians, that natural resources can have a value estimate… But how to obtain this value expression, what the principles are for calculating value, remains the inventor’s secret.”⁵ Today, too, the question of the methodology of value accounting remains disputed, but it is no longer open to doubt that such accounting is necessary and practically possible.⁶ Marx regarded “the discovery of social measures for the quantitative aspect of useful things” as “a task of historical development.”⁷

¹ S. G. Strumilin, Selected Works, vol. 3, p. 455.

² A. L. Vainshtein, The National Economy and National-Economic Accumulation of Pre-Revolutionary Russia. Gosstatizdat, 1960; V. N. Kirichenko, The National Wealth of the USSR. Ekonomika Publishing House, Moscow, 1964.

³ P. Oldak, “Scientific and Technological Progress and the Boundaries of Economic Analysis,” World Economy and International Relations, 1971, no. 8; M. V. Ogorodnikova, “Certain Methodological Questions of Including Education in National Wealth,” in: Theoretical Questions of Socialist Construction. Irkutsk, 1971.

⁴ See: E. Gromov, “The Economic Role of the Service Sphere,” World Economy and International Relations, 1968, no. 11; S. Zagladina, “Does a Unified Sphere of Services Exist?” World Economy and International Relations, 1970, no. 5.

⁵ A. L. Vainshtein, The National Economy and National-Economic Accumulation of Pre-Revolutionary Russia. Gosstatizdat, 1960.

⁶ The many-year discussion in the pages of the journal Problems of Economics has revealed a large group of supporters of this conception. See: Yu. Sukhotin, “On Valuations of Natural Resources,” Problems of Economics, 1967, no. 12; N. Fedorenko, “On the Economic Valuation of Natural Resources,” Problems of Economics, 1968, no. 3, and others.

⁷ K. Marx and F. Engels, Works, vol. 23, p. 44.

Worth noting is E. Freymund’s mention of water as an element of wealth. This caused A. L. Vainshtein some perplexity. “Moreover, in this formulation,” he wrote, “we cannot but be surprised by the article ‘water’ (?) as an element of national wealth. It is unknown what the author means by this natural resource.”¹

Today water no longer seems such an unusual element of wealth. The threat of its pollution by the effluents of industrial and public-utility enterprises, which has intensified in recent years, has accelerated the formation of a new conception of water as genuine wealth, whose reproduction requires considerable and ever-increasing expenditures.²

The tendencies that have emerged in defining wealth are sharply debatable in character; many of the propositions that have been advanced still require serious substantiation. A certain clarity could be introduced by resolving many related problems—the problems of productive and nonproductive labor, the economic role of education, the valuation of natural resources, and others.

Of unquestionable scientific interest are K. Marx’s numerous observations on the forms and essence of wealth. Analysis of a number of statements in the works Theories of Surplus Value and Economic Manuscripts makes it possible, in our view, to come closer to an understanding of Marx’s approach to the definition of wealth.

The first important methodological aspect is that wealth is a social category. The analysis even of the classics of bourgeois political economy, in K. Marx’s words, “goes so far that 1) the independent material form of wealth disappears, and it appears simply as the activity of people. Everything that is not the result of human activity, the result of labor, is nature, and as such is not social wealth. The fetishism of the world of commodities dissipates, and this world appears merely as the constantly vanishing and constantly newly created objectification of human labor. All materially solid wealth is only a transitory materialization of this social labor, a crystallization of the process of production, whose measure is time—the measure of motion itself.”³

Consequently, in the analysis of wealth one should proceed from its creative substance—labor. The material form of the elements of wealth is a very important, but not an absolute, attribute. Such an absolute, constructive attribute of wealth is its existence as the result of labor.

At the same time, K. Marx repeatedly emphasized that “wealth is a thing; it is embodied in things, in material products.”⁴ These propositions are often cited by supporters of absolutizing the object-material form of wealth. However, such a reference may be formal in character if it is taken without regard to the level of development of production and the level of scientific analysis.

K. Marx did indeed consider mainly material wealth in its specifically capitalist form. Such an approach is historically and theoretically justified, if one takes into account that nonmaterial production as socially organized (in K. Marx’s analysis, capitalistically organized) practically did not exist—

existed. K. Marx specifically points out that he abstracts from these forms of production because of their extreme underdevelopment. “All these manifestations of capitalist production in this sphere are so insignificant in comparison with production as a whole that they may be left entirely out of account”⁵. This cannot be said of the contemporary level of the social division of labor, with its clearly expressed tendency toward an increase in the share of those employed outside directly material production. As A. N. Kosygin emphasized at the November (1971) Session of the Supreme Soviet of the USSR, “...over the five-year period the entire increase in labor resources will amount to approximately 10 million people; of these... 4.7 million will additionally be required for material production, while the remaining 5 million will provide the increase in the number of workers employed in education, health care, the service sphere, and other nonproductive branches”⁶.

Following K. Marx’s method, one may abstract only from insignificant economic phenomena; abstraction from the historically concrete level of contemporary development, however, would mean neglecting the principles of the dialectical method of research.

Yet the expansion of the sphere of nonmaterial production is not in itself sufficient grounds for including its results within social wealth. Nevertheless, another definition of wealth permits such conclusions: “...only consumption first makes the product wealth, regardless of how this consumption is carried out: slowly or quickly”⁷. Consequently, K. Marx emphasizes in wealth its function of being a use-value, irrespective of the character of its consumption.

And, finally, one more definition of wealth, highly characteristic of K. Marx, is given in the Economic Manuscripts of 1857–1859: “...what else is wealth if not the universality of needs”⁸.

Needs, as K. Marx repeatedly emphasized, have a historical character; their movement is conditioned by the development of production and, in turn, by their influence upon it. Therefore the expansion of the sphere of nonmaterial production may be regarded as an expression of the historical tendency in the development of needs, increasing their diversity as represented in social wealth.

The second important methodological aspect in K. Marx’s analysis—the category of wealth—is given in development.

Social wealth is a historical category. Its forms and content cannot be regarded as given once and for all. With a change in the social form of production, the social content of wealth changes. Under capitalism “this is a kind of wealth that always has poverty as its premise and that develops only by developing poverty”⁹. Socialism, for the first time in history, transforms the wealth of society into wealth for all members of society.

The movement of the category reflects the development of social production in its socio-economic form, in the movement from a lower stage to a higher one. Higher forms always appear as more complex. This process finds expression in the formation of new, previously unknown forms of wealth.

Thus, at the early stages of social development, “wealth in the form of sheep,” wrote K. Marx in the Economic Manuscripts, “appears as the development of the individual as a shepherd, wealth in the form of grain—as his development as an agriculturist.”¹⁰ The machine stage of capitalist production brings science to the fore as “the most fundamental form of wealth,” but this form, too, has no absolute significance. “The development of science,” K. Marx writes further, “of this ideal and at the same time practical wealth, is only one of the aspects, one of the forms in which the development of the productive forces of man appears, i.e. the development of wealth.”¹¹

The increasing complexity of the economic life of society must inevitably, in a certain sense, modify the category of wealth. Development is accompanied by the withering away of a number of obsolete forms.

The discovery of new forms and the disclosure of their internal connections and interdependencies is one of the theoretical tasks of political economy; K. Marx saw the merit of the classics of bourgeois political economy in its solution. “Through its analysis, political economy breaks down the forms in which wealth appears and which seem to be independent in relation to one another.”¹²

The emergence of new forms of wealth accompanies the development of social production not only in the transition from one formation to another, but also within a single, separately taken formation—for example, the singling out of science as a form of wealth at the machine stage of capitalist production. Consequently, it may be theoretically assumed that socialism, too, in its progressive movement toward communism, is capable of generating new forms of wealth.

Even a simple enumeration of the definitions and forms of wealth mentioned by K. Marx¹³ testifies to their extraordinary diversity; therefore, investigation becomes impossible without their definite subordination. Several levels of the definition of wealth may be distinguished, and everywhere it is traced as a developing category.

The most general definition may be revealed at the level of the formation. K. Marx traces the development of the forms and the essence of wealth from precapitalist formations through to the communist one.

The form of wealth adequate to each social mode of production should be defined on the basis of the goal and the attained level of production.

While asserting the paramount importance of material production for the life of society, K. Marx at the same time opposed its fetishization as the goal of social movement. “Therefore the ancient view,” he writes in the Economic Manuscripts of 1857–1859, “according to which man, however limited he may be in national, religious, or political respects, nevertheless always appears as the aim of production, seems much more exalted in comparison with the modern world, where production appears as the aim of man, and wealth as the aim of production.”¹⁴

Under capitalism there takes place a “universal process of reification.” The domination of material wealth becomes a characteristic feature

bourgeois society with its commodity fetishism. The concentration of wealth in the hands of the ruling class means that it is torn away from the needs of individual persons, exists outside individuals, and is accidental for them. K. Marx writes on this subject: “Labor-power has produced not only alien wealth and its own poverty, but also the relation of this wealth, as self-sufficient wealth, to labor-power as poverty, by consuming which wealth acquires new vital powers and grows again.”^22

Wealth, thus, appears as the end in itself of production, the fetishization of which is manifested still more clearly in the immeasurably growing significance not of real wealth, but of its expression in value, in money. In this connection K. Marx wrote that “exchange value is wealth itself,” money “is wealth itself both in its abstraction from the particular forms of its existence and in its totality.”^23 Commodity fetishism is supplemented by monetary fetishism.

Marx’s analysis reveals the limited character of this form of bourgeois wealth, opposing to it new forms, devoid of fetishistic coverings: “...in actual fact, if one discards the limited bourgeois form, what else is wealth but the universality of needs, capacities, means of consumption, productive forces, etc., of individuals, created by universal exchange.”^24

The definition of wealth, in K. Marx’s opinion, changes following the change in the goal of social movement. In communist society the goal will be the human being himself in his “absolute movement of becoming.” The universality of needs presupposes that, while having material production as their basis, they at the same time are not confined within the framework of the latter. The boundaries of needs expand, and following them the boundaries of wealth also expand.

The principle of the primacy of material production is correct in the sense of the hierarchy of needs, but it does not assert material needs as the only ones that develop. Consequently, social wealth can be formed not only in the sphere of the production of things, but also in that sphere of labor activity which is directed toward the development and improvement of the social individual as a productive and consuming force.

In Theories of Surplus Value we encounter another definition of wealth, which, strictly speaking, belongs not to K. Marx but to the unknown author of a pamphlet published in London in 1821: “Free time, disposable time, is wealth itself.”^25 But if the author’s conceptions as a whole are vague, then K. Marx relates this, in his expression, “splendid thesis” quite definitely to the society of the future.

A more detailed substantiation of this definition is given by K. Marx in the Economic Manuscripts of 1857–1859. The new form of wealth presupposes two conditions. The first is that “free time ceases to exist in an antagonistic form,” since “the working masses must themselves appropriate their surplus labor.”^26 The second condition is a high level of development of the productive forces, when “...with the development of large-scale industry, the creation of real wealth becomes less dependent on labor time and on the quantity of labor expended than on the power of those agents which are set in motion during labor time and which themselves, in their

^22 K. Marx and F. Engels, Collected Works, vol. 46, pt. I, p. 441.
^23 Ibid., p. 165.
^24 Ibid., p. 447.
^25 K. Marx and F. Engels, Collected Works, vol. 26, pt. III, p. 240.
^26 K. Marx and F. Engels, Collected Works, vol. 46, pt. II, p. 217.

in turn (their powerful efficiency), are in no correspondence whatever with the immediate labor time required for their production, but depend rather on the general level of science and on the progress of technology, or on the application of this science to production”¹⁵.

The transformation of labor over time reaches such a level that “direct labor as such ceases to be the basis of production”¹⁶. This leads to a radical change in the role of the worker himself. “Instead of being the principal agent of the production process, the worker stands beside it.”

Together with the change in the functions of labor, the measure of social wealth is also transformed. “As soon as labor in its direct form has ceased to be the great source of wealth, labor time ceases and must cease to be its measure”¹⁷.

The transformation of the measure of social wealth means that free time, rather than working time, acquires enormous significance in the development of the individual. The latter creates only the material prerequisites for development, whereas free time is “the space for the development of abilities.” “Then the measure of wealth,” wrote K. Marx, “will by no means be labor time, but free time”¹⁸. Thus, K. Marx establishes a connection between the forms of wealth—wealth as “the universality of needs” and wealth as “free time.”

The forms of wealth remain manifold. Wealth at any level of social development is not reducible to a single form. One must suppose that under communism, too, the material form of wealth will be preserved as actual wealth, freed from its abstract, monetary shell. “Material wealth,” in the words of K. Marx, “whether subjective, as labor, or objective, as objects serving to satisfy natural or historical needs, appears at first as common to all epochs”¹⁹.

As for the social forms of wealth, their unity at the level of different formations is excluded. If under capitalism the determining form is monetary wealth, then under communism it is free time. It appears as a specifically communist form of wealth, since an increase in the free time of, say, the partially employed or the unemployed in capitalist society is not accompanied by a growth of consumption even under conditions of highly developed production, and does not serve as the basis for the all-round development of the personality.

Thus, “free time” and the “multiplicity of needs” appear as forms of wealth at the level of a highly developed communist society, when material production proper will not require a large number of employed persons. But the fact that material production is accompanied by new kinds of activity directed toward the development and improvement of social individuals as both productive and consuming forces can already be observed today.

The less developed a society is, the more its economic activity is confined mainly to the production of material goods. Conversely, the higher the level of development of the productive forces, the more complex the economic structure becomes, and the greater the significance of labor activity directed toward the production of non-ma—

...consumer values.³² Obviously, it would be wrong still to exclude the latter from the composition of social wealth.

Consequently, from the standpoint of the development of labor in its socially organized totality, resting on broad scientific progress, and from the point of view of the goal of communist production, one can already today speak of a tendency toward the expansion of the economic boundaries of social wealth.

³² Nonmaterial forms of wealth also arise under capitalism. They reflect a fairly high level of economic development; their production assumes the same capitalist form as is inherent in material production. See: USA. The Service Sphere in the Economy. Moscow, Nauka Publishing House, 1971.

1. A. L. Vainshtein, The National Economy and National-Economic Accumulation of Pre-Revolutionary Russia. Gosstatizdat, 1960, p. 63. ↩

2. S. G. Strumilin, “On the Price of the ‘Free Gifts’ of Nature,” Voprosy ekonomiki, 1967, no. 8; K. Korneev, “The Water Wealth of Russia,” Ekonomika sel’skogo khozyaistva, 1970, no. 9. ↩

3. K. Marx and F. Engels, Works, vol. 26, part III, p. 446. ↩

4. K. Marx and F. Engels, Works, vol. 46, part I, p. 475. ↩

5. K. Marx and F. Engels, Works, 2nd ed., vol. 26, part I, p. 421. ↩

6. A. N. Kosygin, “On the State Five-Year Plan for the Development of the National Economy of the USSR for 1971–1975 and on the State Plan for the Development of the National Economy of the USSR for 1972,” Pravda, 1971, November 25. ↩

7. K. Marx and F. Engels, Works, vol. 26, part I, p. 294. ↩

8. K. Marx and F. Engels, Works, vol. 46, part I, p. 477. ↩

9. K. Marx and F. Engels, Works, vol. 26, part III, p. 52. ↩

10. K. Marx and F. Engels, Works, vol. 46, part I, p. 165. ↩

11. K. Marx and F. Engels, Works, vol. 46, part II, p. 33. ↩

12. K. Marx and F. Engels, Works, vol. 26, part III, p. 446. ↩

13. Cf.: wealth—“diversity of needs,” “exchange value,” “mass of use values,” “free time,” “science,” “capital,” “productive forces,” “means of production,” “potential,” “actual,” “social,” “natural,” “material,” “objective,” “abstract,” “monetary,” “consuming.” ↩

14. K. Marx and F. Engels, Works, vol. 46, part I, p. 476. ↩

15. K. Marx and F. Engels, Works, vol. 46, part II, p. 213. ↩

16. Ibid., p. 218. ↩

17. Ibid., p. 214. ↩

18. Ibid., p. 217. ↩

19. Ibid., p. 366. ↩