The conversation of production, productive potential, and Capitalism in general can't adequately be undertaken without including Karl Marx in some way, shape or form. In his day, society looked different because the extensions of Capitalism were much less polished and didn't use propaganda as well as it does today. Let's look closer at Marxism and Capitalism to clarify each.
Marxism isn't Communism, which should be intuitive, however I feel it prudent to make the distinction up front because there is an element of Communism in Marxism's endgame. The component of Communism within Marxism is essentially secondary because at the heart of Marxism are anti-capitalistic premises. Marx didn't develop his political and economic theory due to harboring a deep-seated envy or hatred of Capitalism in response to how well it proliferated in his day. He legitimately understood the flaws of Capitalism and was more than happy to be left out of its cycle of production. So, his theory wasn't a secret way of building a society where people like him could thrive or be appreciated, but an accessible and expansive system of thought which allowed a society to function without economic classes entranced by material production. This system of thought--his economic and political theory--was communistic because anyone could utilize it and everyone would be the beneficiary of the social system. Thus, some people wouldn't be segregated into working slaves, nor others into profit-reaping slave-drivers, nor would everyone believe the cycle was inevitable or "the best way." The whole proletariat-bourgeoisie structure would be abolished.
The way Capitalism separates classes is quite ingenious, because each method or device comes wrapped in some capitalistic incentive which dulls a true cost-benefit analysis of the method, or a basic acknowledgement that valid alternatives still exist. Marx thus described Capitalism as vampiric, because the bourgeoisie sucked the life out of the proletariat via draining their living energy in the production of non-living products which they were told were necessary, and for their own good.
For their own good? Well that's a flat-out lie that people continue to believe to this day. Capitalism in Marx's day separated people from products in that when one worked and produced those products, they became the parent of these products; these products wouldn't exist without them. Then, when they got off work and went about their normal lives, they saw these products on the shelves or in the showroom and legally had no rights to them or any feasible access. They were consumers like anyone else, needing to pay their hard-earned money for these products if they wanted to reap what their hands and minds sowed. (If they purchased these frivolous products though, they wouldn't be able to pay for food, clothing or transportation.) This may seem an innocuous device, but it's actually a raw device of exploitation; workers are coerced to do their best work (or lose their job to their neighbor), so the product comes out the best it can, yet the end product will never bear any evidence of their particular work, only the brand logo which effectively entrances others to needlessly purchase it, or more of it. Hence, the production of capital.
Marx criticized Capitalism's drive for a surplus, because a surplus by definition is an unnecessary excess. When a business operates via generating surpluses, the actual use of the product by the people becomes secondary to the chase for developing products cheaper and in more abundance. So not only does surplus develop a compulsion to produce unnecessary things, it makes production a 365/7 activity because the satisfaction of finite human needs is no longer the primary goal, replaced by cutting costs, expanding the market, and developing in-competition between workers to distract them from realizing their endless slavery. One of the effects of these exploitative and oppressive distractions, Marx points out, is how workers are alienated from each other as human beings. So even when they're off work, they operate with products in mind and their competitive ability to acquire them or not. As a result, Capitalism has also bred income-dependant fears, which Marx saw very clearly.
Whether we're Marxists or not, we can all see how money problems and artifact-competition have entered our common social paradigm. Of course we'll each respond a little differently, but the common social problems within a capitalistic society--sexual power games, artifact-driven competition, general lack of communication with those with either much more or much less money than us, work-based identity, money addiction, materialism, plus many more--are actually toxic byproducts of the system itself, not of individuals failing to fulfill the ideological tenets of the system. Thus, a society--take America--can thrive capitalistically and still develop a myriad behavioral and economic problems. The power of the unit of currency has nothing to do with the legitimacy or endurance of the economic and political ideology, which is a delineation Marx made that benefitted humankind greatly. If it's anything that Marx gave us, it's an understanding that a civilization can move forward on the terms of the selected ideology, but still implode in the long run. Even in the short run it fails, he'd say, because people (in this case, the proletariat) are forced to take jobs solely to generate income, having no other interest in that activity. Ironically, the production machine ascribes the gift of more free time to the participants, but it never states that they will have to sacrifice their existing time to activities they have absolutely no interest in. I don't really call that a net gain of free activity.
Marxism is socialistic in that private property isn't hoarded by the bourgeoisie for the purpose of the underclasses producing more at lower costs. In Marxism, the product of material development benefit everyone, allowing the people to function as an otherwise uninhibited structure. (Humans will always inhibit one another in some way, however Marx's system precludes material-good based inhibition). His vision was production based on need rather than want or social compulsion, so people could focus more on satisfying human and interpersonal needs and endeavors, rather than synthetic social and economic ones. On the surface, this may seem like a philosophical pipe dream, and I'll posit I could have misrepresented and probably under-represented certain things, but Marxism affected people internationally, and is still brought up in political conversations to this day. Sure, it's easy to denounce it through mocking the communistic part, but the severity and clarity of his critique of Capitalism is chillingly realistic and on point.
So, if Marxism is so realistic and raw, how has it all but fallen out of use, with its nemesis Capitalism growing stronger with each decade? Well, the technological revolution really played into Capitalism's hand, because it allowed more and more products to get into the hands of the producers, cheaper and cheaper. Remember how early Capitalism separated the product from the producer? No more. With the proliferation of bank loans and credit cards, now any one of us can clock out and walk into the store or showroom and own exactly what we produced, that night. Also, the incentive of Marxism is much more long-term than Capitalism, which is short-term and immediate, based on the addictive devices attached to each of the productive apparati. Don't want to grow a nice lawn? That's okay, but look at how nice the neighbor's is...it's not really that expensive to have one similar, plus, who wants to be "the neighbor with the unkempt lawn?" These are all toxic behavioral byproducts of Capitalism, which encourages competing with your neighbor over acquisition of material goods, because materials indicate status. Capitalism incentivizes people to produce through developing a sense of individualism and the capacity to write their own destiny, and enjoy the fruits of their labor, today. In some way. Marxism is an abstract ideal that operates for the good of the collective, harboring and developing a community of people (a superstructure) that doesn't compete with one another, but doesn't put all personal goals on hold either. It allows the entire structure to move forward uninhibited by mechanisms it doesn't really need to survive, like surpluses and city-restricted living.
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