III. Formation of joint stock companies. Hereby:

1. Immense extension of the scale of production, and foundation of undertakings which would have been impossible for any individual capital.
2. In itself, capital rests on the cooperation of the many. In the joint stock company it directly assumes the form of social capital, in contradiction to private capital. Here we have the suppression of capital as
258 ' " i/v"/ A' \.\///
private property within the limits of the capitalist mode of production itself.
'3. The capitalist, who, in reality, is the functioning capi- talist, becomes in the joint stock company a mere director, the administrator of the capital of others; and the owners of the capital become mere money capitalists. Even if their dividends include the interest and the profit of undertaking, /. c. the total profit, the latter is none the less obtained henceforth only in the form of interest (for the director's salary is, or is meant to be, a simple labour-wage); that is to say, it is obtained in the form of a mere remuneration due to the owner of capital. Ownership of capital is henceforth entirely separated from the latter's function in the real process of reproduction and vice-versa.
This phenomenon, the result of the most complete development of capitalist production, constitutes an essential stepping-stone to the re-transformation of capital into the property of the producers — not as the private property of individual producers, but as social property. It is also the stepping-stone to the transformation of all those functions hitherto bound- up with the private ownership of capital, into social functions.
As profit, in this case, assumes purely and simply the form of interest, such undertakings are still possible if they do but pay interest.
(Additional Note by Friedrich Fngels: Since Marx- wrote ihe above, new forms of industry have been developed, by which the joint stock company ha- raised to the second and third power. The time- honoured freedom of competition is at an end, and must itself admit its scandalous bankruptcy. It is bankrupt because, in every country, the magnates in any particular branch of industry unite in view of regulating production. In some cases it IMMI came for a time to mleniational trusts, e. jf. between the I'.nglish and tin- (icrman iron industries. But even this form of socialisation of production did not suffice. The antagonism of the interests of the individual business firms caused it to be broken through too often. And thus it came about that, in some branches.
CREDIT AND BANKS. 259
in which the level attained by the process of produc- tion admitted of it, the entire production of the branch was concentrated in one single vast joint stock comp- any under homogeneous management. In these branches, therefore, competition is replaced by monop- oly, and the future expropriation by the whole society, the nation, has been most happily prepared.)
This is equivalent to the abolition of capitalist
production within the capitalist system of production
- a glaring anomaly which already at first sight
appears as a mere transitional stage to a new form
of production.