The state is necessary to perpetuate capitalist relations during economic, political and ecological crises caused by the primary and secondary contradictions of capitalism (O'Connor 1998).
The primary contradiction of capitalism is caused by overproduction. Overproduction is inevitable in capitalism and results in both economic and political turmoil. In order to maximize profit, capitalists aim to maximize surplus value by devaluing labor (either by maximizing constant capital by increasing the productivity of labor through excess work hours or by maximizing variable capital by using innovative technology to increase the productivity of labor). As the productivity of labor increases, so does labor exploitation. In addition, labor exploitation results in both social and economic turmoil (Marx 1867). In short, capitalism destroys the social conditions necessary for the social system to be reproduced.
The secondary contradiction of capitalism is caused by underproduction. This type of crises is exemplified by the "tragedy of the commons" (Hardin 1968). When individual capitalists seek their self-interest in a shared environment, ecological crises is inevitable. In order to maximize profit, capitalists deplete resources and pollute the environment. This eventually leads to ecological crises and underproduction. In short, capitalism destroys the environmental conditions necessary for the social system to be reproduced.
The state tries to manage these crises through social expenditures and social capital spending (O'Connor 1973).
The state facilitates capital accumulation through social capital spending. There are two types of social capital spending by the state: social investment (a form of constant capital) and social consumption (a form of variable capital). Social investment is expenditures that increase the rate of profit by increasing the productivity of labor. Examples of social investment include government subsidized research and development programs. Social consumption is expenditures that increase the rate of profit by reducing the reproductive costs of labor. Examples of social consumption include social insurance programs for the working class. Social capital spending is implemented by the state to help reproduce capitalist relations as capitalists externalize the costs of production.
Through social expenditures, the state works to provide legitimacy for the capitalist system. Social expenses are programs "required to maintain social harmony" (O'Connor 1973:7). Examples include environmental regulations and worker protections. When the state expands through social capital spending, it decreases the value of labor and requires social expenditures by the state to maintain legitimacy. Social expenditures stagnate capital accumulation, which cause it to provide further capital expenditures. This creates a treadmill whereby the state must continuously expand within the capitalist system.
In order for the capitalist system to be reproduced, the state must continue to grow and accommodate for the primary and secondary contradictions of capitalism. However, the growing state primarily benefits while devaluing the working class and competitive capital. In conclusion, the state grows because it benefits monopoly capital and facilitates capital accumulation and legitimacy.
Hardin, Garrett. 1968. “The Tragedy of the Commons.” Science 162: 1243-1248.
Marx, Karl. 1867. Capital: A Critique of Political Economy, Vol. 1. New York, NY: Penguin Books.
O'Connor, James. 1973. The Fiscal Crisis of the State. New York, NY: St. Martin's Press.
O'Connor, James. 1998. Natural Causes: Essays in Ecological Marxism. New York, NY: Guilford Press.