Basic Contradiction of Capitalism, the contradiction between the social character of production and the private capitalist form of appropriation of the products of labour. As the modern productive forces, which are based on large-scale machine industry, develop, production is further concentrated (see Concentration of Production), and there is further social division of labour, while economic ties between various enterprises and industries intensify. Enterprises of different industries, hundreds of thousands and millions of workers incorporated in capitalist organisation of labour at their workplace are directly or indirectly involved in manufacturing all kinds of products. As a result the process of production and labour is increasingly socialised. However, production and its products belong not to those who create them, not to the working people, but to private owners—the capitalists, to their monopoly amalgamations, which use the collectively manufactured products to extract profit, and not in the interests of society as a whole. The basic contradiction of capitalism manifests itself, first of all, in the deep antagonism between wage labour and capital. This contradiction is also expressed in the relative organisation of production at individual enterprises and in anarchy and spontaneous development of the entire capitalist economy. In their race for profits, the capitalists expand production to huge dimensions and increase the exploitation of workers. At the same time, the effective demand of most of the people is limited by the value of the labour power, and when there is permanent mass unemployment, it often is below its value. Therefore, the basic contradiction of capitalism is the cause of the periodic economic crises of overproduction, followed by the squandering of social labour and by the direct destruction of manufactured material wealth. In the imperialist stage of capitalism the basic contradiction increasingly aggravates and deepens. Although scientific and technological revolution accelerates the process of socialisation of production, under the monopoly domination, it engenders new contradictions, which express the discrepancy between the unprecedented opportunities opened up by that revolution and the obstacles which imperialism erects to their utilisation in the interests of society as a whole. The social character of modern capitalist production is glaringly contradicted by the character of state regulation of the capitalist economy in the interests of a handful of monopolists. Capitalism not only breeds its basic contradiction, but also creates the material and subjective conditions to resolve it. Most of the working class is concentrated in large enterprises and in industrial centres. This facilitates its unification, consolidation and organisation in the struggle against the bourgeois class. In the course of revolutionary struggle, the working class, at the head of all the working people, eliminates the basic contradiction of capitalism through the revolutionary destruction of the bourgeois system and its replacement by a more progressive social system—socialism, based on public ownership of the means of production and the appropriation of all products of 27 collective labour by the working people themselves.