The close connection between the social-economic and the material-physical is explained by the particular connection between the material-technical process and its social form in the commodity economy. The capitalist production process "is as much a production process of material conditions of human life as a process taking place under specific historical and economic production relations, producing and reproducing these production relations themselves, and thereby also the bearers of this process, their material conditions of existence and their mutual relations, i.e., their particular socioeconomic form" (C., III, p. 818). There is a close connection and correspondence between the process of production of material goods and the social form in which it is carried out, i.e., the totality of production relations among men. The given totality of production relations among men is adjusted by a given condition of productive forces, i.e. the material production process. This totality makes possible, within certain limits, the process of production of material products indispensable for society. The correspondence between the material process of production, on the one hand, and the production relations among the individuals who participate in it, on the other, is achieved differently in different social formations. In a society with a regulated economy, for example in a socialist economy, production relations among individual members of society are established consciously in order to guarantee a regular course of production. The role of each member of society in the production process, namely his relationship to other members, is consciously defined. The coordination of the working activity of separate individuals is established on the basis of previously estimated needs of the material-technical process of production. The given system of production relations is in some sense a closed entity managed by one will and adapted to the material process of production as a whole. Obviously changes in the material process of production may lead to inevitable changes in the system of production relations; but these changes take place within the system and are carried out by its own internal forces, by decisions of its managing bodies. The changes are brought about by changes in the production process. The unity which exists at the starting point makes possible a correspondence between the material-technical process of production and the production relations which shape it. Later on, each of these sides develops on the basis of a previously determined plan. Each side has its internal logic, but due to the unity at the start, no contradiction develops between them.
We have an example of such an organization of production relations in commodity-capitalist society, particularly in the organization of labor within an enterprise (technical division of labor), as opposed to the division of labor between separate private producers (social division of labor). Let us assume that an enterpriser owns a large textile factory which has three divisions: spinning mill, weaving mill, and dye-works. The engineers, workers and employees were assigned to different divisions previously, according to a determined plan. They were connected, in advance, by determined, permanent production relations in terms of the needs of the technical production process. And precisely for this reason, things circulate in the process of production from some people to others depending on the position of these people in production, on the production relations among them. When the manager of the weaving division receives the yarn from the spinning mill, he transformed it into fabric, but he did not send the fabric back to the manager of the spinning mill as an equivalent for the previously received yarn. He sent it forward to the dye-works, because the permanent production relations which connect the workers in the given weaving mill with the workers in the given dye-works determine, in advance, the forward movement of the objects, the products of labor, from the people employed in the earlier process of production (weaving) toward the people employed in the later process (dyeing). The production relations among people are organized in advance for the purpose of the material production of things, and not by means of things. On the other hand, the object moves in the production process from some people to others on the basis of production relations which exist among them, but the movement does not create production relations among them. Production relations among people have exclusively a technical character. Both of these sides are adjusted to each other, but each has a different character.
The entire problem is essentially different when the spinning mill, weaving mill and dye-works belong to three different enterprises, A, B and C. Now A no longer delivers the finished yarn to B only on the basis of B's ability to transform it into fabric, i.e., to give it the form useful to society. He has no interest in this; now he no longer wants simply to deliver his yarn, but to sell it, i.e. to give it to an individual who, in exchange will give him a corresponding sum of money, or in general, an object of equal value, an equivalent. It is all the same to him who this individual is. Since he is not connected by permanent production relations with any determined individuals, A enters into a production relation of purchase and sale with every individual who has and agrees to give him an equivalent sum of money for the yarn. This production relation is limited to the transfer of things, namely the yarn goes from A to the buyer and the money from the buyer to A. Even though our commodity producer A cannot in any way pull out of the thick network of indirect production relations which connect him with all members of society, he is not connected in advance by direct production relations with determined individuals. These production relations do not exist in advance but are established by means of the transfer of things from one individual to another. Thus they not only have a social, but also a material character. On the other hand the object passes from one determined individual to another, not on the basis of production relations established between them in advance, but on the basis of purchase and sale which is limited to the transfer of these objects. The transfer of things establishes a direct production relation between determined individuals; it has not only a technical, but also a social significance.
Thus in a commodity society which develops spontaneously, the process is carried out in the following way. From the point of view of the material, technical process of production, each product of labor must pass from one phase of production to the next, from one production unit to another, until it receives its final form and passes from the production unit of the final producer or intermediate merchant into the economic unit of the consumer. But given the autonomy and independence of the separate economic units, the transfer of the product from one individual economic unit to another is only possible through purchase and sale, through agreement between two economic units, which means that a particular production relation is established between them: purchase and sale. The basic relation of commodity society, the relation between commodity owners, is reduced to "a capacity in which they appropriate the produce of the labor of others, by alienating that of their own labor" (C., I, p. 108-109). The totality of production relations among men is not a uniformly connected system in which a given individual is connected by permanent connections, determined in advance, with given individuals. In the commodity economy, the commodity producer is connected only with the indetermined market, which he enters through a discrete sequence of individual transactions that temporarily link him with determined commodity producers. Each stage in this sequence closely corresponds to the forward movement of the product in the material process of production. The passage of the product through specific stages of production is brought about by its simultaneous passage through a series of private production units on the basis of agreements among them, and of exchange. Inversely, the production relation connects two private economic units at the point where the material product passes from one economic unit to the other. The production relation between determined persons is established on the occasion when things are transferred, and after the transfer it is broken once again.
We can see that the basic production relation in which determined commodity producers are directly connected, and thus for each of them the established connection between his working activity and the working activity of all members of society, namely purchase and sale, is carried on regularly. This type of production relation differs from production relations of an organized type in the following ways: 1) it is established between the given persons voluntarily, depending on its advantages for the participants; the social relation takes the form of a private transaction; 2) it connects the participants for a short time, not creating a permanent connection between them; but these momentary and discontinuous transactions, taken as a whole, have to maintain the constancy and continuity of the social process of production; and 3) it unites particular individuals on the occasion of the transfer of things between them, and it is limited to this transfer of things; relations among people acquire the form of equalization among things. Direct production relations between particular individuals are established by the movement of things between them; this movement must correspond to the needs of the process of material reproduction. "The exchange of commodities is a process in which the social exchange of things, i.e., the exchange of particular products of private individuals simultaneously represents the establishment of determined social production relations which individuals enter when exchanging things" (Zur Kritik der politischen Oekonomie, 1907, p. 32).[1] Or, as Marx put it, the process of circulation includes Stoff- und Formwechsel (Content and Form of Exchange) (Das Kapital, Volume III Part 2, 1894, p. 363), it includes the exchange of things and the transformation of their form, i.e., the movement of things within the material production process and the transformation of their social-economic form (for example, the transformation of commodities into money, money into capital, money capital into productive capital, etc.), which corresponds to the different production relations among people.
Social-economic (relations among people) and material-objective (movement of things within the process of production) aspects are indissolubly united in the process of exchange. In the commodity-capitalist society these two aspects are not organized in advance and are not adjusted to each other. For this reason every individual act of exchange can be realized only as the result of the joint action of both of these aspects; it is as if each aspect stimulated the other. Without the presence of particular objects in the hands of given individuals, the individuals do not enter into the production relation of exchange with each other. Yet, inversely, the transfer of things cannot take place if their owners do not establish particular production relations of exchange. The material process of production, on one hand, and the system of production relations among individual, private economic units, on the other, are not adjusted to each other in advance. They must be adjusted at each stage, at each of the single transactions into which economic life is formally broken up. If this does not take place, they will inevitably diverge, and a gap will develop within the process of social reproduction. In the commodity economy such a divergence is always possible. Either production relations which do not stand for real movements of products in the process of production are developed (speculation), or production relations indispensable for the normal performance of the production process are absent (sales crisis). In normal times such a divergence does not break out of certain limits, but in times of crisis it becomes catastrophic.
In essence, the connection between the production relations among people and the material process of production have the same character in a capitalist society stratified into classes. As before, we leave aside production relations within an individual enterprise, and deal only with relations between separate, private enterprises, relations which organize them into a unified national economy. In the capitalist society, different factors of production (means of production, labor force and land) belong to three different social classes (capitalists, wage laborers and landowners) and thus acquire a particular social form, a form which they do not have in other social formations. The means of production appear as capital, labor as wage labor, land as an object of purchase and sale. The conditions of labor, i.e., means of production and land, which are "formally independent" (C., III, p. 825) from labor itself in the sense that they belong to different social classes, acquire a particular social "form," as was mentioned above. If the individual technical factors of production are independent, and if they belong to separate economic subjects (capitalist, worker and landowner), then the process of production cannot begin until a direct production relation is established among particular individuals who belong to the three social classes mentioned above. This production relation is brought about by concentrating all the technical factors of production in one economic unit which belongs to a capitalist. This combination of all the factors of production, of people and things, is indispensable in every social form of economy, but "the specific manner in which this union is accomplished distinguishes the different economic epochs of the structure of society from one another" (C., II, pp. 36-37).
Let us imagine feudal society, where the land belongs to the landlord, and the labor and means of production, usually very primitive, belong to the serf. Here a social relation of subordination and domination between the serf and landlord precedes and makes possible the combination of all the factors of production. By force of common law the serf uses a plot of land which belongs to the landlord, and he must pay rent and serve a corvee, i.e., work a given number of days on the manor, usually with his own means of production. Permanent production relations which exist between the landlord and the serf make possible the combination of all factors of production in two places: on the peasant's plot, and on the manor.
In capitalist society, as we have seen, such permanent, direct relations between determined persons who are owners of different factors of production, do not exist. The capitalist, the wage laborer, as well as the landowner, are commodity owners who are formally independent from each other. Direct production relations among them have yet to be established, and then in a form which is usual for commodity owners, namely in the form of purchase and sale. The capitalist has to buy, from the laborer, the right to use his labor force, and from the landlord, the right to use his land. To do this he must possess enough capital. Only as the owner of a given sum of value (capital) which enables him to buy means of production and to make it possible for the laborer to buy necessary means of subsistence, does he become a capitalist, an organizer and manager of production. Capitalists use the authority of directors of production "only as the personification of the conditions of labor in contrast to labor, and not as political or theocratic rulers as under earlier modes of production" (C., III, p. 881). The capitalist "is a capitalist and can undertake the process of exploiting labor only because, being the owner of the conditions of labor, he confronts the laborer as the owner of only labor-power" (C., III, p. 41). The capitalist's status in production is determined by his ownership of capital, of means of production, of things, and the same is true of the wage laborer as the owner of labor power, and the landlord as owner of the land. The agents of production are combined through the factors of production; production bonds among people are established through the movement of things. The independence of the factors of production, which is based on private ownership, makes possible their material-technical combination, indispensable for the production process, only by establishing the production process of exchange among their owners. And inversely: direct production relations which are established among the representatives of the different social classes (the capitalist, worker and landlord), result in a given combination of technical factors of production, and are connected with the transfer of things from one economic unit to another. This tight connection of production relations among people with the movement of things in the process of material production leads to the "reification" of production relations among people.
[1] In the Russian translation by P. Rumyantsev, this is incorrectly translated as "result" - Kritika politicheskoi ekonomii (Critique of Political Economy), Petersburg, 1922, p. 53. Marx said Erzeugung (production, establishment) and not Erzeugniss (product, result). [Below, when Rubin quotes from the Russian translation, we will quote from K. Marx, A Contribution to the Critique of Political Economy (translated by N.I. Stone), Chicago: Charles H. Kerr and Co., 1904, and in future citations we will refer to this edition as Critique.]