(1.ii.16) In this sense of the term "owners of labour," the parties, concerned aboutproduction, are divided into two classes, that of capitalists, the rich men who supply the materials andinstruments of production; and that of the workmen, who supply the labour.
(1.ii.17) These terms are all sufficiently familiar; but a few observations are furthernecessary, in order, on this important subject, to preclude, as far as possible, confusion of ideas.
(1.ii.18) The great capitalist, the owner of a manufactory, if he operated with slaves insteadof free labourers, like the West India planter, would be regarded as owner both of the capital, andof the labour. He would be owner, in short, of both instruments of production: and the whole ofthe produce, without participation, would be his own.
(1.ii.19) What is the difference, in the case of the man, who operates by means of labourersreceiving wages? The labourer, who receives wages, sells his labour for a day, a week, a month,or a year, as the case may be. The manufacturer, who pays these wages, buys the labour, for theday, the year, or whatever period it may be. He is equally therefore the owner of the labour, withthe manufacturer who operates with slaves. The only difference is, in the mode of purchasing.
The owner of the slave purchases, at once, the whole of the labour, which the man can everperform: he, who pays wages, purchases only so much of a man's labour as he can perform in aday, or any other stipulated time. Being equally, however, the owner of the labour, so purchased,as the owner of the slave is of that of the slave, the produce, which is the result of this labour,combined with his capital, is all equally his own. In the state of society, in which we at presentexist, it is in these circumstances that almost all production is effected: the capitalist is theowner of both instruments of production: and the whole of the produce is his.
(1.ii.20) There is a distinction of capital into two sorts, arising from a difference in the modeof applying it. To this distinction as some consequences of importance are attached, it is necessarythat a correct idea should be attained of it.
(1.ii.21) Of the articles, whereof capital consists, some are of a durable nature, andcontribute to production without being destroyed. Of this nature is a great proportion of the tools andmachines, which are employed both in agriculture and manufactures. Such are the buildingssubservient to the various kinds of production; and such are all the other accommodations, notnecessary to be enumerated, which do not perish in the using. That portion of capital, whichcomes under this description, has been denominated "Fixed capital."(1.ii.22) There is another portion of the articles, subservient to production, which do perishin the using. Such are all the tools worn out in one set of operations, all the articles, whichcontribute to production only by their consumption, as coals, oil, the dye stuffs of the dyer, theseed of the farmer, and so on. Of this nature, also, are the raw materials worked up in thefinished manufacture. The wool of the clothier is consumed in the making of his cloth, thecotton of the cotton manufacturer in making his muslins. Under the same head must be includedthe expence of repairing and keeping in order the more durable articles of fixed capital. Thedistinctive character of all this portion of capital is, that it is necessarily consumed, incontributing to production, and that it must be reproduced, in order to enable the producer tocontinue his operations. This has been denominated "circulating" capital; but by a veryinappropriate appellation. There is nothing in its consumption and reproduction which bearsmuch resemblance to circulation. It would be much better to call it "reproduced" capital,although the word "reproduced," being a past and not a future participle, is not unexceptionable;it is capital which constantly needs to be reproduced, because, in contributing to production, it isconstantly consumed.
(1.ii.23) There is another thing, which is also constantly consumed, and constantly needs tobe reproduced, and that is, the subsistence, or consumption, or wages of the labourer; and that,equally, whether the labourer supplies it to himself, or receives it from the capitalist, in theshape of wages; that is, pay, in advance, for his labour. In this latter shape, being advanced bythe capitalist out of those funds, which would otherwise have constituted capital in thedistinctive sense of the word, and being considered as yielding the same advantage, it isuniformly spoken of under the name of capital, and a confusion of ideas is sometimes theconsequence.
(1.ii.24) When all these items are included, it is obvious, that a very great proportion of theconsumption and production, of every country, takes place for the sake of reproduction. This is ahighly important fact, of which the consequences will hereafter occur for more particularconsideration.
(1.ii.25) It follows, necessarily, if the instruments of labour, the materials on which it isemployed, and the subsistence of the labourer, are all included under the name of capital, thatthe productive industry of every country is in proportion to its capital; increases when its capitalincreases; and declines when it declines. If the instruments of labour, the materials to workupon, and the pay of workmen, are all increased, the quantity of work will be increased,provided more workmen can be obtained. If more workmen cannot be obtained, two things willhappen: First, wages will be raised; which, giving an impulse to population, will increase thenumber of labourers: Secondly, the scarcity of hands will whet the ingenuity of capitalists tosupply the deficiency, by new inventions in machinery, and by distributing and dividing labourto greater advantage.
