Social policy, social exclusion and commodity fetishism.

Introduction

Since 1997, the New Labour government has developed administered contemporary social policy around the ideals of social inclusion. The Social Exclusion Unit (SEU), Welfare to Work and New Deal Programmes (1998) provide the chief manifestations of socially-inclusive policy. The set: describes social exclusion as the 'short hand for what can happen when people or areas are suffering from a combination of linked problems such as unemployment, poor skills, low incomes, poor housing, high crime, bad health and family breakdown' (SEU, 2001: 10). The shift to social inclusion policy is a response to the need to prevent individuals at risk of exclusion from becoming excluded, according to the SEU: a need it proposes to address by, for example, resolving to reverse the growth in family breakups, teenage pregnancies and crime, and to reduce possible restrictions to an individual's 'economic opportunity'. And, where necessary, policy should be designed with the aim of reintegrating those already excluded socially, through programmes such as the New Deal and Welfare to Work (ibid: 29).

A more critical appraisal of social inclusion policy has been put forward by Levitas (1996). For Levitas, social inclusion defines a set of inter-related policy mechanisms for reconfiguring social policy objectives in terms of moral blame, rather than the redistribution of wealth. Levitas points out that, while the language of social inclusion has its origins in European social policy, and in particular in the concern to redress the blight of structural unemployment and poverty through active state intervention in the market, in the UK the language has been heavily influenced by us policy in redefining social exclusion/inclusion on the basis of two overlapping discourses: one emphasising moral obligations, and the other positioning individuals as part of an underclass. Both are designed to enforce the 'social integration' of those who find themselves 'excluded', through the moral injunctions of the work ethic (Levitas, 1998). Levitas, moreover, situates social inclusion as part of a broader shift towards a new 'Durkheimian Hegemony', which involves social policy at the forefront of, on the one hand, enforcing social cohesion around degrees of market-attachment and, on the other hand, the treatment of deprivation and inequality as pathologies, and as individual disorders/ deviancies (ibid, 1998). Lister (1998: 215) has also pointed out how the framework of social inclusion represents a paradigm shift in social policy, away from the focus on structural inequalities and poverty and towards equality through raising individual opportunities and emphasising individual responsibilities.

The pathologising dimensions of social inclusion policy that Levitas makes reference to have been elaborated upon by Jones and Novak (1999), for whom the rhetoric of social inclusion and exclusion provides the legitimation for suppressing and reversing hard-won welfare rights. As Jones and Novak argue, 'the moralising dynamic of New Labour' underpins' the need to create a social policy framework wherein the duty 'to work, to save, to adopt a healthy life style, to do homework, to parent in the approved manner, take precedence over rights' (Jones & Novak, 1999: viii). Indeed, as I will explain later, the systematic abuse and demonisation of welfare claimants is the mark of a contemporary social policy that works both to actively 'include' as well as actively 'exclude' individuals. The point at issue right now, however, is that, while arguments such as those raised above define and demonstrate how social inclusion operates, they do less to explain why there has been a social policy shift to social inclusion. We know, for example, about the shift from welfare to workfare; from a philosophy of 'handouts to 'hand-ups'; from 'public to private'; and from 'client to consumer', ad infinitum. What we are less sure of is why this shift has occurred and, therefore, what its real significance is.

It is in this area that Bauman (1998) and Byrne (1999) have made timely and valuable contributions. Both authors provide useful pointers towards why this should be, by providing a political economy of social exclusion and inclusion.

Bauman argues that the shift in social policy towards the language of social inclusion is a result of key economic trends in the West, leading to the growth of a population that has become surplus to labour-market requirements. Byrne argues that social-inclusion rhetoric is the surface-froth of the more fundamental shift to post-Fordist patterns of capital accumulation, where those at the margins of inclusion and exclusion serve as part of the reconstitution of a reserve army of labour power.

Clearly, Bauman and Byrne differ in their explanations: Bauman viewing the 'excluded' as an unwanted surplus to the expansion of capital, and Byrne viewing the excluded as vital to capitalist expansion.

I will argue that the strengths and limitations of both Bauman's and Byrne's contributions lead analysis to the heart of social inclusion and the contradictions between capital and labour, which are inherent to capitalism as a commodity-producing society. We begin with a discussion of Bauman's (1998) contribution.

We then assess Byrne's (2000) contributions. The second part of the article then demonstrates the relevance of commodity fetishism to providing a more profound understanding of the implications of the development of labour power surplus to capital.

Bauman: Social exclusion as 'surplus population'

For Bauman, contemporary changes in social policy are part of the wider shift of the welfare state away from policy directed at supporting the recommodification of labour power. Capital accumulation up until the 1980s required the state to play its role in the provision of key resources, including housing, education, health and, when necessary, welfare payments to the unemployed. This, for Bauman, ensured the recommodification of quality labour power and also secured a viable reserve army; both of which were essential for post-war capitalist expansion. Since the 1980s, argues Bauman, capital accumulation has become increasingly premised on the rationalisation of the use of labour power, and thus on the shedding of the labour force. As a consequence, the role of the welfare state has changed, moving towards means-tested and targeted benefits, and towards--via training and employment policies--catering for capitalism's need for insecure, low-quality labour power, and the disciplining of a growing surplus population. As Bauman observes, '[t]he present-day stream-lined, downsized, capital--and knowledge--intensive industry casts labour as a constraint on the rise of productivity' to such a degree that 'economic growth and the rise of employment are, for all practical intents, at cross-purposes; technological progress is measured by the replacement and elimination of labour' (Bauman, 1998: 65).

Bauman observes the way the leitmotiv of stock-market success in the corporate us, and increasingly in corporate Europe, is marked by the ability to shed labour and impose draconian contracts on those retained (Bauman, 1998: 52-53). The shift in welfare-state priorities towards social inclusion signifies deeper changes in the recommodification of labour power. In this context, the issue of social exclusion and the rhetoric of social-inclusion policy signifies the emergence of a surplus population which is no longer required by capital as a reserve army of labour. To be sure, a reserve army of labour still exists in non-Western, industrialised areas of the world. For the West, though, capital no longer requires a welfare state committed to the universal provision of key services and social needs, because the maintenance of a reserve army is no longer functional to capital accumulation. For Bauman, the welfare state will become increasingly residual as social policy confines itself to organising the control and administration of a population increasingly isolated from the capitalist labour market. Government is haunted by the prospect of the homeless and disinherited flocking in and capital flocking out (Bauman, 1998: 54). This, for Bauman, is the reason why social exclusion and social-inclusion policy predominates discourses on welfare.

Bauman's argument provides a useful explanation of the shift in social policy towards social inclusion. However, the hard-and-fast equating of social exclusion with a surplus labour force playing no role as a reserve army is both empirically and theoretically suspect. Bauman ignores the day-to-day realities of the capitalist system in the West, where the links between capital's demand for labour power and a surplus of unemployed remain of crucial importance. For Bauman's proposition to hold, one must assume that those experiencing social exclusion have no connection with the labour market and the status of wage labour. Yet evidence does not support such a view. Evidence suggests a degree of complexity, with people variously experiencing exclusion with no labour-market attachment, exclusion with some labour-market attachment, and inclusion with weak and/or strong labour-market attachments (Labour Market Trends: 2002). In other words--and as will be detailed later--the experience of exclusion is as likely to be one premised on poor, unstable employment as it is as on unemployment and 'unemployability' (Levitas, 1999). Evidence, discussed later, will suggest that labour power continues to function as a reserve army of labour, however attenuated this function might be. A more realistic proposition for Bauman to make might be that the surplus population is growing at a faster rate relative to its function as a reserve army of labour. In this case, those experiencing this situation have little choice, within the constraints of contemporary capitalism, but to remain unemployed and consequently, as Dinerstein suggests, suffer the humiliation of having to beg for work and be in a permanent state of readiness to offer their labour power as a commodity (Dinerstein, 2002). Yet Bauman is clearly not proposing this. Why doesn't Bauman at least recognise this possibility? One reason is his approach to capitalism.

There is a tendency in Bauman's analysis to treat the relationship between the welfare state and the capitalist economy solely in terms of recommodification, when just as fundamental to an understanding of this relationship is the opposite process of decommodification. Leaving out the latter is, effectively, to leave out half of the contradiction driving the relationship between state and economy and, of course, capital and labour. Such an omission has a number of consequences for the understanding of social inclusion and the wider shift in welfare-state priorities already highlighted above. The latter will be argued through in some detail, drawing on Marx, later in this article. Here we can simply state that, within commodity production, the contradiction between the recommodification and the decommodification of labour power is itself premised on the contradiction between production for use value and social need and production for exchange value and profits.

Therefore, addressing only one aspect of the contradiction effectively closes down the link between social policy, social welfare states and the fundamental tension between social needs and profits which provides the basis for understanding the state as an arena of class struggle.

Before we address this further we need, first, to consider the counter-argument raised by Byrne since he, too, for different reasons, discards the contradiction inherent to commodity relations when he rejects the idea of a surplus population, in favour of viewing social exclusion/inclusion dynamics solely in terms of the reconstitution of a reserve army of labour.

Byrne, social exclusion and the reserve army of labour

Byrne (1999) argues that what Bauman considers to be a surplus population is nothing more than the re-articulation of a reserve army of labour, in order to fit post-Fordist conditions of capital accumulation. For Byrne, the preceding Fordist era, which came to a close towards the end of the 1970s, was a failed attempt by the capitalist state to 'demand manage' the economy in an effort to stabilise profit rates, by raising the capacity for mass consumption--the more positive by-product being a reduction in social inequality and levels of poverty. However, the 'full employment' cost of this byproduct, for capital, was its adverse effects on the capacity to discipline labour in the time-honoured manner: through an activated reserve army of labour power. Byrne argues that, against a background of diminishing wage differentials, reduced inequalities and a malfunctioning reserve army, changes in labour-market circumstances for individuals within the working class brought only small negative/positive differences in life-chances (Byrne, 1999). As a result, the threat of frictional unemployment bore little impact on standards of living and this spilled over into the workplace, where it became increasingly difficult for managers to 'manage' the working class. Under such conditions, a welfare state based on universalism became both a necessity--to curb labour unrest--and a blight, inasmuch as it threatened accumulation.

In contrast the post-Fordist era has, according to Byrne, made a decisive break with 'social gradualness' with respect to changes in individual life-chances, as reflected by the current retrenchment of welfare provision. Byrne (1999) argues that the turn to post-Fordist patterns of accumulation, compounded by welfare retrenchment, has created two parallel social worlds within the working class: one where labour power is maintained and developed through high wages and stable employment, and one where labour power remains under-developed in a manner harmonious to the requirements of the growing low-waged, insecure employment sector. The two 'worlds' represent the reactivation of a surplus population as a reserve army of labour in the following way.

Movement between the 'worlds' is volatile and highly fluid at the margins, producing profound changes in life-chances for individual households. Moreover, in a period when management and professional sections of the labour-force themselves experience the insecurities of flexible employment and under-employment (insecurities that have always been systemic to non-professional labour), the volatility of and fluidity between the excluded and the included has increased dramatically across society, reactivating a reserve army of labour (Byrne, 1999).

This volatile, fluid movement between developed and underdeveloped segments of the labour market facilitates the reconstitution of a reserve army of labour, and is the basis for the growth in social exclusion. Byrne argues that the contemporary social policy emphasis on social inclusion/ exclusion represents the commitment of successive governments to reactivating a reserve army of labour, more fitting to the requirements of a post-Fordist era of accumulation. Social exclusion does not, therefore, represent a surplus population, but a reconstituted reserve army of labour power.

The argument that Byrne presses is a persuasive one. He provides us with a powerful explanation of contemporary trends, particularly of the way the reserve army of labour is being reconstituted following decades in which capital's control over the working class had weakened in the face of stagflation during the 1970s. Yet there remain key weaknesses in his analysis.

Although Byrne rejects Bauman's association of social exclusion with a surplus population, he nonetheless falls into the opposite trap of arguing that the surplus population/ socially-excluded can only be understood in terms of the reserve army. Unfortunately, the many useful insights that Byrne furnishes are diminished by his failure to engage with the contradictions inherent in the commodity form of production.

Byrne presents an account of capitalism that relies on functionalist explanation. Consequently, he tends to impose Marx's analytical explanation of the 'general law of capital accumulation', with particular reference to 'surplus labour' (Marx, 1954: 574-652), on the concrete forms of contemporary capitalism, where the interplay of many capitals with the complex social formation takes place, without paying enough attention to how the 'law' is mediated by the latter.

To be sure, Marx's account of the relationship between surplus population and reserve army of labour is also an account that abstracts from the concrete in order to explain its essential operation.

However, Marx was also fully aware that, at the level of the concrete, the surplus population and its relationship with the reserve army would shift and change in response to many factors. Neither Bauman nor Byrne pay due attention to this movement from the abstract to the concrete when pressing Marx's theory into their service, in explaining the relationship between the surplus population and the reserve army of labour power.

Marx's analysis of the relationship between reserve army of labour and surplus population should be seen more in terms of a moving contradiction, which is crucial in paving the way for an understanding of current social inclusion policy as a set of mechanisms with which to divide and reorder the included from the excluded.

As the next section will demonstrate, Marx's own account of the reserve army of labour and surplus population provides the basis for an alternative understanding of social exclusion: one that lays a more secure basis for a discussion of social policy in terms of commodity fetishism and the contradictory development of recommodification and decommodification.

Marx, the surplus population and the reserve army of labour

In abstract analytical terms, Marx described how developments in the working population are the outcome of two contradictory tendencies that employment policy must ultimately manage. The first tendency is for a long-term demand for labour power to decline relative to the increase in capital, which is punctuated in the short term by the expansion of labour into new markets and industries. As Marx suggests, '[s]ince the demand for labour is determined not by the amount of capital as a whole, but by its variable constituent alone, then demand falls progressively with the increase in the total capital ... instead of rising in proportion to it' (Marx, ibid: 590).

The second tendency is for the economy to lurch through a process of long-term booms and slumps punctuated by short-term business-cycle oscillations. Of particular note to Marx was that, while the first tendency compels the need for labour mobility and provides the basis for the development of a labour force surplus to capital, the second tendency makes this surplus a necessary prerequisite of accumulation in order to establish a reserve army of labour. For, as Marx suggests, '[it] is capitalistic accumulation itself that constantly produces, and produces in the direct ratio of its own energy and extent, a relatively redundant population of labourers ... for the average needs of the self-expansion of capital' (Marx, ibid: 590).

As real abstract tendencies, the relationship between a surplus population and reserve army of labour will depend on the rate of movement between constant capital and variable capital. By 'constant capital' is meant the value composition of the means of production. By 'variable capital' is meant the value of labour power and the fact that labour power generates the surplus value that is the source of profits. Where the use of technology becomes key to accumulation, and so the capacity of labour power to increase surplus value, the tendency is to a displacement of variable capital for constant capital to occur.

There is no inevitable inverse relationship between constant and variable capital even at this level of abstraction. This is mainly because the displacement of labour power from one industry can be absorbed and usually extended by, for example, the extension of labour power into new or developing industries. There could, for example, be a significant accumulation of capital based entirely on labour-intensive plant such as building equipment or mining equipment, etc. However, contemporary forms of accumulation in the West, as the relative displacement of labour from first industry and now, increasingly, services (e.g. the rationalisation of labour in the banking sector) indicate, are dominated by capital-intensive growth (EC, 2001). This is no surprise, since the key to increased surplus value on the basis of an upward movement in profit rates is making labour power more productive, by increasing the use of technology and science in the form of constant capital. This makes the displacement of variable capital for constant capital a tendency inherent in the nature of the capital-labour relation, and a foundation for the development of a surplus population. More specifically, whenever constant capital grows in value relative to variable capital, a surplus population results (i.e. surplus to the direct needs of capital accumulation). The surplus population becomes a reserve army for capital and it succeeds in serving two related functions: to facilitate the expansion and contraction of capital accumulation through the economic cycle; and to discipline workers--through the competition for jobs provided by an available standing army--into accepting wage rates that do not eat into surplus value, and accepting working conditions conducive to maximising surplus value.

Leaving the abstract analytical level, in practical terms the nature of the reserve army of labour--its extent and existence--depends crucially on historically-specific and contemporary conditions. In this sense, one cannot read off contemporary conditions from the analytical abstract treatment. One must instead begin with the contemporary conditions. These conditions would include capitalist competition, the balance of class forces, the level and nature of state intervention in the economy, and the industrial mix at any one point in time. All of these factors will influence both the magnitude of the surplus population and the degree to which it functions as a reserve army of labour (Rosdolsky, 1977). If, for example, capital can increase the supply of labour from the existing working population (i.e. variable capital)--say, by increasing overtime working--then, within limits, it can expand accumulation by drawing on a latent reserve of labour power already employed, without having recourse to an actual surplus population for its potential to supply reserves of exploitable labour. On the other hand, if the balance of class forces weighs against capital (which is not the case currently) and, for example, the labour movement is able to shorten the working week, to regulate contracts and to resist lengthening the working day and/or intensifying the use of its labour power, then a large surplus population would be required if the reserve-army function were to have its disciplinary effect on the labour market.

The surplus population can and often does increase dramatically for reasons only indirectly related to the requirements of capital for a reserve army. For example, whenever the state, as a major employer of labour power engaged in the production of those use values that underpin the social wage, is forced--as is presently the case--to rationalise the use of labour power across the public sector, then this swells the ranks of surplus labour far beyond the economic requirements of capital for a reserve army of labour. Such alternating scenarios intimate to us that the relative rates at which constant capital and variable capital rise are crucial in determining the balance of forces between capital and labour that social policy internalises, and yet must also attempt to resolve.

Of course--and this is the crucial point insofar as state involvement with social policy is concerned--any attempt to actually control the relative rates of growth of variable and constant capital is beyond the powers of the state. Social policy can only attempt to manage the consequences as best as it can within the limits of the capitalist system. Therefore, any given situation is characterised by a number of limitations for contemporary social policy. For example, contemporary social policy must deal with a growing working-age population, in the context of a global accumulation strategy that places limits on the state's ability to provide a social wage. Social policy must also increasingly limit itself to subsidising poorly paid, insecure work (Dean & Shah, 2002), which has become necessary in order to facilitate the continued investment and expansion of capital. When we add these to the ongoing rationalisation of public-sector labour power, then we have the conditions for a growing chasm between the potential surplus population that is required to function as a reserve army, and the actual surplus population.

Moreover, the above chasm would be further widened by the trade union movement's inability to regulate contracts of employment on terms more favourable to labour. This inability allows capital to raise a substantial part of its reserve army from labour power already employed. The general increase in working hours experienced by a significant sector of the workforce, and the more intense use of labour power through a variety of flexible working practices, is testimony to this.

The crucial point to be made here is that conditions may be ripe at the level of the concrete, and within the present political and economic climate, for a surplus population to grow over and above its function as a reserve army, just as an increasing amount of the wage work available through the labour market is increasingly poorly-paid and insecure, with little status or prospects to advance the individual on a career ladder (Byrne, 2000). In this context, social policy is necessarily contradictory: it must serve, on the one hand, to control and isolate the threat to civil order from a surplus population and, on the other hand, to promote mechanisms that increase, both directly and indirectly, labour-market attachment (Peck & Theodore, 2000).

One could question the existence of a surplus labour-force by citing the increase in labour-intensive services, and especially the capacity for the public sector to absorb surplus labour. However, one is reminded that the question of surplus absorption is dictated by the requirements of the patterns of global accumulation of capital shaped by neoliberalism. The service sector has experienced rationalisation in its use of labour, as has the public sector.

Capitalism, as Marx long ago observed, expands by reducing labour time. The development of surplus labour is an indication that more wealth can be created from the exploitation of less labour power and in excess, as financial speculation reveals, of conditions conducive to capital expansion.

The above argument would suggest that the relationship between the surplus population and a reserve army of labour should be understood in terms of the complex outcome of concrete struggles between capital and labour. Such a dialectical relation is clearly evident in New Labour's social-policy agenda with respect to social inclusion and exclusion, to which we now briefly turn in order to sketch out the theoretical context developed so far.

Reconsidering New Labour's exclusion/inclusion policy

The developing contradiction between surplus population and reserve army requires social policy that is able to facilitate the conditions for the recommodification of labour power, while also providing policy mechanisms which act to discipline labour power in the process of decommodification, relative to its necessity to capital accumulation. What follows is a brief survey of policy direction to demonstrate this theoretical point. Evidence suggests that policy is necessarily ambiguous due to its having to take simultaneous account of a reserve army of labour, and a population surplus to the requirements of contemporary forms of capital accumulation.

New Labour policy acts in a number of direct and indirect ways in its attempt to control the articulation between the reserve army and surplus population. Policy, in this respect, both includes individuals in their status as reserve army of labour, and excludes individuals by regulating them in accordance with their status as surplus to capital.

On the one hand, contemporary social policy is deeply exclusionary when overseeing the inexorable and related rise in the rate of the prison population; the 'demonisation' of the poor through mechanisms of means-testing; an escalation of social panics concerning (apparently-increasing) benefit fraud (Spicker, 2001) and asylum-seekers as 'welfare scroungers' (Sales, 2002); and recent criminal-justice legislation aimed at 'social cohesion'/'order in the community'.

New Labour carries through such policy with a zest and fervour that can hardly be viewed in any way other than as deeply exclusionary (regardless of the inclusive rhetoric of official government policy statements). It is estimated, for example, that Britain will have the second-highest prison population by 2008, when it is expected to have risen by 30 per cent, from its present level of 64,600 to 83,500 (Spicker, 2001). The present level of 64,600 is itself the result of a rapid expansion since the early 1990s, when the prison population stood at 40,000.

Pressure on the resources of the prison and justice systems have extended this barrack-style 'lockdown' mentality into the community. For example, it has been argued that the 1998 Crime and Disorder Act should be interpreted as part of a raft of policy that has shifted emphasis from youth justice to the criminalisation of 'problem' families (Muncie, 1999: 153), 'corralled in housing estates and neighbourhoods which take on ever more characteristics of the most impoverished regions of the world' (Jones & Novak, 1999: 102).

On the other hand, New Labour policy is very much related to inclusion within the reserve army of labour power. The New Deal, Lifelong Learning and Welfare-to-Work programmes, etc., are a set of related policies designed, in part, to maintain the bridge between the surplus population and its status as a reserve army of labour (Levitas, 1998). In fact, since the mid-1980s, governments of all shades have made a concerted effort to develop a workfare state that increases labour-market attachment. The introduction of Training and Education Councils (TECS); the 1986 Restart Programme; the 1989 Social Security Act; the 1995 Job Seekers Act; the 1996 Right To Work Act; and the post-1998 New Deal/Welfare to Work programmes, have all worked towards increasing the reserve army of labour and maintaining labour-market discipline.

However, the same policies also exhibit strong exclusionary tendencies, which serve to discipline a surplus population. In this respect, as Peck argues, the TECS became more of a vehicle for administering the unemployed than a platform for skills-development and labour-market attachment (Peck, 2000). In a very similar way, the various Restart schemes and the current New Deal have excluded as much as they have included. While the New Deal has made some impact in regenerating a reserve army of labour power by increasing labour-market attachment for poor and unstable forms of 'flexible' work (Peck, 1998), its other main effect has been to force the unemployed through a revolving door, from welfare to training scheme and back again (Peck & Theodore, 2000). By so doing, social policy serves the purpose of actively excluding, as well as including, a surplus population that is outgrowing its use as a reserve army of labour.

Such developments suggest that social policy is very much focused on actively excluding, as much as including, a population increasingly surplus to capital accumulation, and ever greater than its function as a reserve army. As a result of this dialectic, social policy must become more visibly coercive in providing new forms of control over the working class, in the context of a growing chasm between the reserve army and surplus population. However, one can only grasp the profundities of this situation by placing it within the context of Marx's analysis of commodity fetishism and, more specifically, the tendency for it to weaken as an objective form of social discipline on the working class. Both Byrne and Bauman neglect the centrality of commodity fetishism when discussing the contemporary consequences of the development of a population surplus to capital. They write of capitalism, capital and recommodification, yet these categories are not derived from the relations of commodity fetishism that ultimately give rise to them. However, as I will demonstrate, commodity fetishism is the very essence from which the categories of capital emerge, including the reserve army of labour and surplus population. What follows--the second section of this article--considers the contribution Marx's emphasis on commodity fetishism can make to an understanding of social policy in general, and to the specific focus on social exclusion/inclusion in particular.

The concept of commodification and social policy

Ferguson, Lavalette and Mooney have noted, with reference to social policy, how the importance of commodity fetishism is becoming much clearer in 'our own times than it was when Marx was writing' (Ferguson, Lavelette & Mooney, 2002: 89). While this may be the case, what remains less than obvious is the relationship between commodity fetishism and its objective basis in relations of commodity production and social policy. It is invariably the case that whenever commodity fetishism is discussed, it is its subjective aspects that are prioritised.

For example, the concept of commodification has been taken up and applied to social policy in very useful ways from, largely, outside the classical Marxist tradition. The concept figures centrally, if implicitly, in Habermas's earlier work on the legitimation crises faced by the welfare state (1974), which were caused by the pressure to cut back on promised social needs in accordance with the criteria of exchange value and the pursuit of profitability.

Commodification is also a central, if implicit, assumption of Habermas's later work on the contradiction between the 'system world' (instrumental reason and commodified relations) and the 'life worlds' (the decommodified cultural, political and social spheres). Moreover, Beck's (1992) concepts of 'risk society' and its attendant 'risk regimes' (2000) prefigure the increased commodification of social policy and welfare services in the shift towards late modernity. However, the two most influential accounts of commodification, which bear directly on social policy, have been those of Offe and Esping-Anderson. Anderson has emphasised the centrality of commodification processes for understanding the causes of different 'welfare regimes'. Welfare regimes are said to differ in the extent to which they emphasise decommodification or commodification of welfare services (Esping-Anderson, 1990).

However, while this may be the case, and despite some reflections on the historical and social causes of these differences, Anderson's analysis of the causes is, somewhat paradoxically, deeply ahistorical. His argument remains too reliant on the formalism of ideal-type constructions of 'welfare regime' to provide an adequate account of the contradictory class relations that underpin the tendential movements in decommodification/commodification. Moreover, while Offe (1982) provides crucial insights into the conflict-ridden and highly unstable nature of commodification and, in particular, the role of social policy in maintaining the commodification of labour power, his analysis too is hidebound by an emphasis on market over class relations of production.

Overall, contributions of this sort focusing on the relationship between commodification and social policy tend to omit any serious discussion of class relations of production in favour of an emphasis on market relations. As a result, the relationship between labour power and the commodity becomes reversed, with serious consequences for an understanding of social policy and social exclusion. For example, both Esping-Anderson and Offe separate out the market for labour from the market for commodities: by implication, the latter can then appear to be able to exist without the former. By contrast, for Marx the opposite is the case: commodity markets are the expression of commodity relations between capital and labour. The implications of this categorical reversal of production for market relations are revealed in terms of policy orientation. For example, Offe's argument leads him to the realpolitik social-democratic position, which suggests that social policy--no matter how irresolvable the contradiction--has a necessary role to play in treating labour as more than a commodity. More specifically, it leads away from a dialectical understanding of the links between commodification, commodity fetishism and social policy.

Marx, commodity fetishism and social policy

Omitting to consider the internal link between the production and exchange of commodities, which establishes labour's commodity status, shuts off any real solutions to the developing contradiction between capital and labour that social policy internalises. For Marx, the exchange of goods and services as commodities is premised on labour taking the commodity form (Knafo, 2002). Because of this, the contradictions at work are much more fundamental than critical commentaries on commodification would have us believe.

The contradiction is premised on the essential opposition between exchange value and social need, which can only be resolved in favour of the latter by the working class. What underpins the irresolvable contradiction are relations of commodity fetishism and, more crucially, their decline. It is this contradiction that, in turn, underpins the development of a population surplus to capital accumulation, which serves as the essential problematic faced by contemporary social exclusion/inclusion policy.

Specifically, the class struggle between capital and labour generates specific social categories through which the working class is exploited and controlled. Control is achieved through atomisation, because direct social-production bonds between people are replaced by indirect relations between people, established through things (e.g. commodities, money, wages, prices, etc.): relations that take systemic hold only when labour power itself becomes a commodity (Rubin, 1973). It should be stressed that, by definition, the decline of labour power's status as a commodity must also signify the decline of relations of commodity fetishism, which must inevitably effect the development and shape of social policy--a point to which I will return later.

Rubin summarises both the fetish character, as well as the controlling impulses, of commodity production relations as follows:

   In a market society, a thing is not only "a receptacle"
   under which social production relations among people
   are hidden. A thing is an intermediary in social relations,
   and the circulation of things is inseparably related to the
   establishment and realization of the productive relations
   among people. The movement of the prices of things on
   the market is not only the reflection of the productive
   relations among people; it is the only possible form of
   their manifestation in a market society ... More accurately,
   it conceals the production relations precisely because the
   production relations only take place in the form of
   relations among things. Exchange and the equalization
   of things on the market bring about a social connection
   among the commodity producers and unify the working
   activity of people. (Rubin, 1973: 10)

Rubin is drawing our attention here to the objective role of commodity fetishism as a relation between worker and capital; between capital and capital; and between worker and worker. Commodity production relations are established through commodities, and their social as well as their exploitative character remains hidden behind the equality of market exchange.

First, the two-fold nature of the commodity as a use value and an exchange value is obscured. Second, the relations established by and through commodity fetishism make it appear as if the source of exchange value--value--is to be found either in the natural properties of the commodity in its role as a use value (subjective value), or else in the concrete labour expended in making the commodity (the Ricardian labour/value problematic).

Commodity fetishism both reproduces and at the same time obscures the dual nature of labour power as abstract and concrete, and in so doing it obscures the role of the former as the content of value. Commodity fetishism, as a consequence of obscuring the source of value, also obscures the origin of money, of capital and so of surplus value. For Marx (1974), relations of commodity fetishism provide the necessary social forms through which capital subordinates labour power.

Of course, relations of commodity fetishism are never neatly constituted as categories of exploitation and control, which capitalism simply exudes automatically. Rather, the relation is always stretched; always this side of breaking point; and always threatened by its own inner negation under pressure from the working class, and torn asunder by capitalist competition and crises. Therefore, one must stress the point that capital attempts to subordinate labour power, because commodity fetishism is the active outcome of class struggle between capital and labour, and not a permanent condition. In this sense, the subordination, exploitation and control of labour power by capital is, for Marx, contingent on the power of commodity fetishism, but is never guaranteed on this basis alone. It is, in other words, necessary, but never sufficient to successfully control the working class.

The ability to continue to subordinate the working class within relations of commodity fetishism is of crucial importance for capital, because it helps to sustain the material conditions for the domination of labour in the class struggle over the direction and legitimacy of production for exchange value/profit. Moreover, working-class subordination to relations of commodity fetishism is vital to controlling the scope and provision of social needs within the value form (Marx, 1954: 339-475).

To summarise, commodity fetishism establishes the basis for the development of key social categories that further the control exerted over labour power, such as 'wage', 'price' and 'money'. On the other hand, it is also the working class's continual resistance to commodity fetishism, through the struggle for social need over and above value, that ultimately threatens the development and indeed the existence of these social categories of exploitation and subordination. It is within this contradiction that social policy is formed and applied.

Social policy internalises the aforementioned contradiction. Which is to say that social policy attempts to resolve the contradiction between use and exchange value, and between concrete and abstract labour. The latter becomes manifest at the level of the state as the contradiction between the necessity to provide some form of social wage, and the necessity to secure the conditions for the continuation of a system of exploitation based on wage labour.

The above sets in motion a dialectical contradiction between social policy and commodity fetishism. On the one hand, the commodity's nature as capital and so value tends to corrupt the integrity and intrinsic meaning of its nature as use values. On the other hand, the commodity can only fully realise its nature as a use value if it develops free from its value form of existence. As Marx argued, the development of money simply allows this contradiction space in which to develop in a more antagonistic fashion. In short, one nature--use value--can only flourish by either subordinating or eradicating the other--value form. What can be said for commodities in general is even truer for the commodity labour power. Labour power as a use-value-fulfilling activity can only realise its full potential if it frees itself from the constraints of abstract labour and, therefore, from being the content of value. The point is that the development of a surplus population greater than that absorbed as a reserve army of labour signifies two related things: a) that capital is finding it increasingly difficult to subordinate labour to the commodity form; and b) that this difficulty opens up the potential for the working class to develop alternatives to wage labour as a basis for social production relations.

Moreover, it is this potential that both Gorz and Meszaros have seized on in outlining their visions of a transition beyond capital. Gorz argues that the ultimate threat from labour, as a result of contemporary developments in capitalism towards a population surplus to capital, is the capacity to exodus from the rule of capital into what he describes as 'true work' (non-waged labour). This, he argues, would mark the development of 'multi-activity based work' (Gorz, 1999: 77). Meszaros (1991) argues that such an 'exodus', in opposition to the law of commodity relations, would be guided by 'the law we give ourselves as freely associated producers', in opposition to 'capital's imposed, but increasingly defunct, "law of economy of time"' (1991: 65).

What both authors draw our attention to is that in a society based upon a vast amount of 'disposable free time', the exchange of activities, rather than the exchange of commodities and the propensity for time thrift, will open the way to an enhancement of the possibilities for, and discussion of, what each person's different social needs are and how they should be met. Within this 'new modality', argues Meszaros, 'total disposable time becomes expendable on a multiplicity of activities which could not possibly enter into the earlier enforced economic equations, no matter how acute the need' (Meszaros, 1991: 66). It is this potential pathway from capital that furnishes the basis for contemporary trends in social policy, and in particular for the emphasis on social exclusion and inclusion.

Conclusion

In this paper, I have argued that without a basis in the dialectics of commodity fetishism, one can at best develop only a one-sided and functionalist account of capitalism, and of the social-policy changes it gives rise to, such as social exclusion/inclusion. In concluding, I draw out some of the more contemporary consequences of the argument as it relates to social policy in the UK.

Within the context of the above argument, contemporary social (inclusion/exclusion) policy can be understood as an attempt to close off pathways that might lead towards the potential exodus of labour from its commodity form. For Bowring, the exodus would imply 'breaking with the logic of exchange values, which dictates that the only needs worth expressing are those that correspond to commodity equivalents'. It 'also means breaking the link between the right to an income and the obligation to earn or use that income in ways consistent with the economic and cultural hegemony of capitalism' (Bowring, 2000: 307). Social inclusion/exclusion policies are, fundamentally, about maintaining and preserving this link.

In this respect, social policy has the increasingly difficult task of managing labour within the commodity form, while subordinating social need to what can be 'afforded'. Currently, this is expressed in the commodification of social welfare through the use of quasi-markets, audit cycles and public-private-partnerships; and the extension of means-testing and 'work for welfare' schemes, etc.

However, the social welfare state's ability to manage the commodity form of labour power has always required a fine balance between freedom for capital to accumulate surplus value, and the state's regulation of that freedom in the interests of securing the commodity status of labour power. The impossibility of achieving such a balance has placed severe limits on social-welfare provision. Since 1945, first social democratic and then neoliberal regimes have fallen prey to this contradiction. Fundamentally, the 'balance' is chimerical, leading to either increased repression, or to the possibility for labour power to break free of its commodity form (Gorz, 1999).

New Labour's social inclusion and exclusion policy bears the scars of the internalisation of: a) the past failures of social policy to manage the commodity form of labour power and subordinate social need; and b) the necessary but equally impossible task of establishing a new synthesis. New Labour's 'Third Way' attempts to manage the commodity form of labour power in a context in which the capitalist economy itself places limits on the need for labour power in its form as variable capital. The limit, in turn, places severe structural constraints on the ability of social policy to subordinate an increasing population surplus to capital to the commodity form. Nevertheless--extremely difficult or not--both the management of the commodity form, and the subordination of collective forms of labour production and consumption of welfare, remain necessary to social policy. In this respect, contemporary social policy associated with the social inclusion/exclusion agenda is charged with maintaining a limited commitment to a social wage, while also securing the subordination of labour power to the commodity form under conditions where it lacks the capacity to sustain and reproduce labour power without state subsidy.

One very positive conclusion of this argument is that the structural prerequisites for a future exodus of labour already exist, in the form of the growing inability to manage labour power within the constraints of the commodity form and, subsequently, the increasing inability of social policy to subordinate labour power to capital.

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