V. I.   Lenin

New Data on the Laws Governing the Development of Capitalism in Agriculture

PART ONE—Capitalism and Agriculture in the United States of America

American census statistics, for all their shortcomings, compare favorably with those of other countries because of the completeness and uniformity of the methods used.   This makes it possible to compare the returns for industry and agriculture for 1900 and 1910, and to contrast the over all picture of the structure of both sectors of the economy and the evolution of this structure. One of the most popular ideas in bourgeois economics—an idea, incidentally, which Mr. Himmer repeats—is to contrast industry and agriculture. Let us see, in the light of a mass of precise data, what truth there is in such a contrast.

Let us begin with the number of enterprises in industry and in agriculture.

The enterprises in agriculture are much more numerous and much smaller. That is an expression of its backwardness, parcellization, and dispersion.

The number of enterprises increases much more slowly in agriculture than in industry. There are two factors in the United States which do not exist in other leading countries, and which greatly intensify and accelerate the growth in the number of enterprises in agriculture. They are, first, the continued parceling out of the slave-holding latifundia in the South and “buying-up” by Negro and also by white farmers of small parcels from the “planters”; secondly, the availability of an immense quantity of unoccupied, free land, which is distributed by the government to all applicants. Nevertheless the number of enterprises in agriculture is increasing at a slower rate than in industry.

The reason is twofold. On the one hand, agriculture to a rather large extent retains the character of a “natural” economy, and various operations once performed by members of a peasant household are gradually branching off from agriculture—for example, the making and repair of various implements, utensils, etc.—and now constitute separate industries. On the other hand, there is a monopoly which is peculiar to agriculture and unknown to industry, and which cannot be eliminated under capitalism—the monopoly of land ownership. Even when there is no private property in   land—in the United States none actually exists on very large areas to this very day—monopoly is created by the ownership of land and its occupation by individual private operators. In the country’s most important regions all the land is occupied, and an increase in the number of agricultural enterprises is possible only when existing enterprises are broken up; the free formation of new enterprises alongside the old is impossible. The monopoly of land ownership is a drag on the development of agriculture, and this monopoly retards the development of capitalism in agriculture, which, therefore, is unlike industry in this respect.

We are unable to make an accurate comparison of the amounts of capital invested in industrial and in agricultural enterprises because ground-rent forms a part of the value of the land. Accordingly, we have to compare the capital invested in industry and the value of industrial products with the total value of all farm property and the value of the major farm product. Only the percentages showing increases in the total values on both sides are strictly comparable.

We find that during the 10 years from 1900 to 1910 the value of capital invested in industry and the value of all farm property have doubled. The great and fundamental difference between the two is that in agriculture the major product, cereals, increased by an insignificant 1.7%—while the total population increased 21%.

Agriculture lags behind industry in development; this is a feature of all capitalist countries constituting one of the most profound causes of disproportion between the various branches of the economy, of crises and soaring prices.

Capital liberated agriculture from feudalism and drew it into commodity circulation and thereby into world   economic development, lifting it from medieval backwardness and patriarchal stagnation. But capital, instead of eliminating the oppression, exploitation and poverty of the masses, produces these calamities in a new guise and restores their old forms on a “modern” basis. The contradiction between industry and agriculture, far from being eliminated by capitalism, is, on the contrary, further extended and sharpened by it. The oppression of capital, seen primarily in the sphere of trade and industry, weighs more and more heavily on agriculture.

The insignificant increase in the quantity of agricultural produce (+1.7%) and the enormous increase in its value (+79.8%) shows clearly, on the one hand, the role of ground-rent, the tribute extorted from society by the landowners. Because of their monopolist position, they are able to take advantage of the backwardness of agriculture, which does not keep pace with industry, and to fill their pockets with millions and millions of dollars. In the 10 years, the value of all farm property increased by $20,500 million, of which only $5,000 million constituted the increase in the value of buildings, livestock and equipment. The value of land—capitalized ground-rent—increased in the 10 years by $15,000 million (+118.1%).

On the other hand, the difference in the class status of the small farmers and the hired labourers is here thrown into especially sharp relief. To be sure, both labour; to be sure, both are subject to exploitation by capital, though in entirely different forms. But only vulgar bourgeois democrats will for this reason put the two different classes together and speak of small-scale operations by family farms. To do so is to cover up and disguise the social system of the economy—its bourgeois nature—and push into the foreground a feature common to all earlier formations, namely, the necessity for the petty farmer to work, to engage in personal, physical labour, if he is to survive.

Under capitalism, the small farmer—whether he wants to or not, whether he is aware of it or not—becomes a commodity producer. And it is this change that is fundamental, for it alone, even when he does not as yet exploit hired labour, makes him a petty bourgeois and converts him into an antagonist of the proletariat. He sells his product, while   the proletarian sells his labour-power. The small farmers, as a class, cannot but seek a rise in the prices of agricultural products, and this is tantamount to their joining the big landowners in sharing the ground-rent, and siding with the landowners against the rest of society. As commodity production develops, the small farmer, in accordance with his class status, inevitably becomes a petty landed proprietor.

There are cases even among wage-workers when a small part of them side with their masters against the whole class of wage-earners. But this is merely a small fraction of a class uniting with its antagonists, against the entire class. It is impossible to imagine any improvement of the condition of wage-earners as a class, without an improvement in the living standard of the masses, or without a sharpening of the antagonism between them and capital, which rules contemporary society, the antagonism between them and the entire class of capitalists. But it is quite possible, on the contrary, to imagine a state of affairs—indeed, such a situation is even typical of capitalism—where an improvement in the condition of the small farmers, as a class, results from their alliance with the big landlords, their participation in exacting a higher ground-rent from society as a whole, the contradictions arising between them and the mass of proletarians and semi-proletarians, who depend, entirely or at least mostly, on the sale of their labour-power.

Here is a comparison of American statistics on the number and position of wage-earners and of small farmers:

The workers in industry lost, for their wages went up by only 70.6% (“only”, because almost the same quantity   of cereals, 101.7% of the old quantity, is now 179.8% of the old price!), while the number of workers in creased all of 40%.

The small farmers gained, in their capacity of petty landowners, at the expense of the proletariat. The number of small farmers increased by only 10.9% (even if the small commercial farms are singled out, the increase is still only 11.9%), and while the quantity of their product hardly increased at all (+1.7%), its value went up 79.8%.

Naturally, commercial and finance capital took the lion’s share of this ground-rent, but the class status of the small farmer and the wage-earner, vis-à-vis each other, is entirely akin to the status of petty bourgeois and proletarian.

The numerical growth of wage-earners outstrips the growth of population (+40% for the former as against +21% for the latter). There is growing expropriation of the petty producers and small farmers. There is growing proletarization of the population. ^[1]

The increase in the number of farmers—and to an even greater extent, as we already know, in the number of proprietors among them—lags behind the growth of the population (10.9%, as against 21%). The small farmers are increasingly converted into monopolists, into petty landed proprietors.

Let us now take a look at the relationship between small-scale and large-scale production in industry and in agriculture. In respect of industry the figures are not for 1900 and 1910, but for 1904 and 1910.

Industrial enterprises are divided into three main groups depending on the value of their products, the small being those with an output of less than $20,000; the medium, from $20,000 to $100,000, and the large $100,000 and over. We have no way of grouping agricultural enterprises except by acreage. Accordingly, small farms are those up to 100 acres; medium, from 100 to 175; and large, 175 and over.

The uniformity of evolution proves to be remarkable.

Both in industry and agriculture the proportion of medium establishments is reduced, for their number grows more slowly than that of the small and large enterprises.

Both in industry and agriculture the small enterprises increase in number at a slower rate than the large.

What are the changes in the economic strength or economic role of the various types of enterprises? For the industrial enterprises we have the returns on the value of their products, and for the agricultural, on the total value of all farm property.

Once again the uniformity of evolution is remarkable.

Both in industry and agriculture the relative number of, small and medium enterprises is decreasing, and only the relative number of the large enterprises is increasing.

In other words, the displacement of small-scale by large-scale production is under way both in industry and in agriculture.

The difference between industry and agriculture in this case is that the proportion of small enterprises in industry increased somewhat more than the proportion of medium enterprises (+21.5%, as against +19.5%), while the reverse was true for agriculture. Of course, this difference is not great, and no general conclusions can be drawn from it. But the fact remains that in the world’s leading capitalist country small-scale production in industry gained more ground in the last decade than medium-scale production, whereas the reverse was true for agriculture. This fact shows how little importance is to be attached to the current assertions of bourgeois economists that the law of the displacement of small-scale by large-scale production is confirmed, unconditionally and without any exception, by industry, and refuted by agriculture.

In the agriculture of the U.S.A. the displacement of small-scale by large-scale production is not merely under way, but is proceeding with greater uniformity than in industry.

In considering this, the fact demonstrated above should not be forgotten, namely, that the grouping of farms by acreage understates the process of displacement of small-scale by large-scale production.

As for the degree of concentration already achieved, agriculture is very far behind. In industry, more than eight-tenths of all production is in the hands of the large enterprises that constitute only 11% of the total number. The role of the small enterprises is insignificant: two-thirds of the total number of enterprises account for only 5.5% of the total production! By comparison, agriculture is still in a state of dispersion: small enterprises, comprising 58% of the total number, account for one-quarter of the total value of all farm property; while 18% large enterprises account for less than one-half (47%). The total number of agricultural enterprises is over 20 times greater than the number in industry.

This confirms the old conclusion—if the evolution of agriculture is compared with that of industry, capitalism in agriculture is at a stage more akin to the manufactory stage than to the stage of large-scale machine industry. Manual labour still prevails in agriculture, and the use of machinery is relatively very limited. But the data given   above do not in any way prove the impossibility of socializing agricultural production, even at the present stage of its development. Those who control the banks directly control one-third of America’s farms, and indirectly dominate the lot. In view of the modern development of associations of every kind and of communications and transport, it is undoubtedly possible to organize production under a single general plan on a million farms raising more than one-half the total value of the product.

Notes

[1] The number of wage-earners in agriculture, or rather the growth in their number, is obtained from the following ratio: 82.3:70.6 =x : 40.4, hence x=47.1. —Lenin