Capitalist Mode of Production, a social mode of production of material benefits, based on private capitalist ownership of the means of production and the exploitation of wage labour. "We call capitalist production,” Marx wrote, "a social mode of production under which the process of production is subordinated to capital, i. e., which is founded on the relationship between capital and hired labour" (Karl Marx, Zur Kritik der politischen Okonomie [Manuskript 1861-1863], Part 1, p. 120). It replaced the feudal mode of production. Under capitalism, society is divided into two main antagonistic classes— the class of capitalists, or owners of the means of production who exploit the working people; and the class of proletarians, who are deprived of the means of production and means of livelihood and are therefore compelled to constantly sell their labour power to the capitalists. The main economic law and the stimulus of the capitalist mode of production is the creation of surplus value by the workers and its appropriation by the capitalists. The unpaid labour of wage workers is the source of surplus value. Compared to previous modes of production (primitive communal, slave-owning and feudal) the capitalist mode of production is more progressive since it ensured the higher level of development of society’s productive forces, radically raised the productivity of social labour, completed the socialisation of production and labour on a huge scale, 34 sharply increased the volume of production, and raised its technological level. Although the capitalist system, and the corresponding mode of production, developed the productive forces of society to an unprecedented extent, it nevertheless condemned, due to its inherent irreconcilable class contradictions, a large section of the population—the working people—to wage labour, poverty and deprivation, since all the benefits of the growth of social production under this system are reaped primarily by the capitalists. The main contradiction of the social system based on the capitalist mode of production is that between the social character of production and the private capitalist form of appropriation (see Basic Contradiction of Capitalism). By collecting millions of workers at plants and factories, and by socialising the process of labour, capitalism gives a social character to production but the results of labour are appropriated by the capitalists. This basic contradiction of capitalism is revealed in the anarchy of production and the lagging of society’s effective demand behind expanding production—a fact which results in destructive periodic economic crises. In turn, the crises and periods of economic stagnation impoverish small producers even further, gradually increase the dependence of hired labour on capital and the relative and at times absolute deterioration of the economic and social position of the working class. During economic crises of overproduction, the productive forces are destroyed on a mass scale, unemployment sharply increases, a great number of people are deprived of productive labour, much of the machinery is idle at capitalist-owned factories and is even sometimes destroyed. With the development of capitalism, the degree of exploitation of the working class increases, all the contradictions of the capitalist mode of production sharpen, and the class struggle intensifies and becomes even more fierce. With the transition of capitalism to the highest and last stage of its development, i. e., to imperialism, and especially during the general crisis of capitalism the contradictions of the bourgeois mode of production deepen and become particularly acute. Factors such as the omnipotence of monopoly capital in the capitalist states’ economy and politics, the tendency towards degeneration and parasitism, the increasingly uneven economic and political development of capitalism at the stage of imperialism, the utilisation of achievements in science and technology for the militarisation of the economy, the unrestricted arms race and growing social contradictions and conflicts within bourgeois society, further undermine the foundations of the capitalist mode of production. Capitalism cannot cope with the productive forces which it has created and which have extended the limits of capitalist production relations and become obstacles to their further development. Historically, modern capitalism has become outdated, and must be replaced by a more progressive system— socialism. The objective and subjective prerequisites for the transition to a new communist mode of production develop within bourgeois society during the development of the capitalist mode of production. The victorious Great October Socialist Revolution in Russia brought about the first ever destruction of the capitalist mode of production. The domination of the capitalist mode of production was also brought to an end in several other countries as a result of socialist revolutions.