Marx and his critique of capitalism

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In the northwest corner of London’s Highgate cemetery squats a large marble tombstone, resplendent with a massive bust of one of capitalism’s greatest critics—Karl Marx (1818-1883). The irony of the location would not be lost on the German-born social scientist, historian, philosopher and revolutionary as cars speed down the adjacent Swains Lane through a stately pocket of England’s capital city arguably boasting a higher concentration of new and old-style capitalists per square km than anywhere between Calais and Connecticut.

The inscription reads: “Workers of all lands, unite”. It is the call to arms (and final sentence) of the Inaugural Address of the Working Men’s International Association in 1864. It was both a review of the working class movement since the unrealised insurrections of 1848 and a charter document for the First International. What was the revolutionary prelude to 1848 and what were workers uniting towards in 1864? The response is conveniently encapsulated in two basic assessments of Marx’s contribution to the political economy. That is, his critique of capitalism and claims for the superiority of communism.

“The contradictory quality of capitalism …[according to Marx] was its paradoxical union of organisation and anarchy” (Sabine & Thorsen, 1973, p. 715). Capitalism, like all other preceding economic epochs was a transitory one, that would in time, at an advanced and sophisticated stage, succumb to its congenital flaws—increased worker alienation, the increasing antagonism of the class divide, the labour or “surplus” theory of value, the principle of declining profit, the fetishism of commodities and the infectious extent of working class antagonism, among others. Having been helped to its demise, by none more so than the supposedly impoverished proletariat, a new and superior socialist economy would emerge, freed of private property and composed of free individuals who jointly owned the means of production in a stateless society where humans—having reverted to the communist idyll—will once again realise their essential nature. It is a grandiose, some might say, utopian theory of transition and destination that needs a little explanation and historical context.

The decade preceding the revolutionary outbreaks of 1848 witnessed a rapid growth of industry, widespread famine and intense political ferment in many parts of Europe. Consequently the poor suffered immeasurably and so became increasingly attracted to socialist and communist ideas. These views acknowledged and explained the contrast between the misery of the masses and the wealth of the owners of the emerging industrial mode of production—the bourgeoisie, or capitalists. The great promise of industrial society, that free men and women might finally satisfy their material and spiritual needs, remained unfulfilled. “Promise and reality diverged ever more sharply as the industrial revolution destroyed traditional social institutions and beliefs, while leaving the nature of the emerging society temporarily in doubt” (Bender, 1988, p.2).

Was Marxism then the saviour of the proliferating disenfranchised working class? Marx and Engels certainly thought so. History however, has not been so convincing. Marx—at least up until the mid 19th century—was unique in the annals of historicism. The originality of his thought lies in the immense efforts to synthesise, in a critical way, the entire legacy of social knowledge since post-Socratic times. According to Carver (1991, p.41) Marx’s seminal body of economic theory was subjected to “logical, philosophical, mathematical, social, political and historical analysis”. His purpose was to achieve a better understanding of the conditions of human development and with this understanding, to accelerate the actual process by which mankind was moving toward an “association, in which the free development of each is the condition for the free development of all”. The desired system would be a communist society based on rational planning, co-operative production, equality of distribution and, quintessentially, liberated from all forms of political and bureaucratic hierarchy.

Marx arrived at this understanding via a materialist conception of history, an explanation of which is mandatory in understanding his critique of capitalism and one that also needs to be seen in the historical context of the increasingly exploitative aspect of the industrial revolution, which, by the time Marx had graduated from the university of Berlin in the 1841, was in full and profit-driven swing.

To understand the present and even hint at the future, Marx adhered to the ancient Greek maxim that nothing is, everything becomes. This contemplation of the kinetic nature of existence, at least in the materialist tradition, maintained that the evolution of human society as a whole and that of all human institutions, is not, as the idealists insisted, the result of the changes in men’s and women’s ideas relative to the society they were living in. Rather, the development of society, including ideas and institutions, is first and foremost, the result of the evolution of the material conditions under which humans live for they are the only conditions that both exist and develop independently: ideas only reflect the existence and maturation of the material world, they do not preempt them.

Such an approach (materialistic) revealed the inherent primacy of the economic sphere in shaping all other areas of social activity. It was an inventive summation derived by scientific and empirical endeavour. For Marx, economics is the driving force in human development. According to the materialist conception of history, the sum total of the relations of production—the way humans organised their social production as well as the instruments they used—constituted the real foundation of society. It was on this base that there rose a legal and political superstructure to which corresponded definite forms of social consciousness.

It was a premise he advocated almost from the outset of his post-Hegelian days in Paris and referred to in The German Ideology (1846) but later dutifully argued in his 1859 Preface to the Contribution to the Critique of Political Economy (Tucker, 1972, p. 4).

The mode of production of material life conditions the social, political and intellectual life processes in general. It is not the consciousness of men that determines their being, but, on the contrary, their social being that determines their consciousness.

Having established the economic as the dominant sphere of society, Marx turned to the scandalous working conditions in mines and factories and the societal dislocation taking place around him in the name of capitalism. In the process, he identified the consolidation “of a proletariat by the divorce of the peasantry from common rights in the land, the destruction of household industry by the growth of capitalist organisation, the steady increase in the size and power of the units of such organisation and the acceleration of these processes by the expropriation of the church and the colonial exploitation of America and the Indies” (Sabine & Thorsen, 1973, p. 712). It was an intolerable environment that Marx envisaged would be replaced by another superior order.

In his critique of this “dehumanising” intolerable, capitalist environment, Marx took on board the concepts of the “classical” economists of the time—Ricardo in particular—and used them to arrive at vastly different, and soonafter, discredited conclusions. Ricardo had made a distinction between use-value and the exchange-value of labour. The exchange-value of an object was something entirely separate from its price that consisted of the amount of labour embodied in the objects produced, though Ricardo thought that the price in fact approximated the exchange-value. In so surmising, Marx et al incorrectly accepted that the circumstances of production rather than those of demand determined the value of an object. However, to this imperfection, Marx hung the cornerstone of his economic argument—the notion of surplus-value, a notion that Engels regarded as his comrade’s principal discovery in economics.

The classic defense of capitalism, at least according to Sabine and Thorsen (1973, p. 715) is that everyone in a system of “free exchange, would, in the long run, receive back a value equivalent to that which he [or she] brought to the market and would thus receive [their] equitable share of the social product”. In Marx’s mind however, “labour will always be forced to produce more than it receives and more than is required to keep the system going” (Sabine & Thorsen, 1973, p. 715) and as Marx conclusively contested that labour was merely a commodity, wages would therefore amount to the barest subsistence minimum.

Here, he disputed the English economist, Thomas Malthus (1766-1834) who propounded that population pressures drove wages to subsistence levels. Rather, because of the system of private ownership and the capitalist’s monopolistic position in that system, the capitalist could force workers to spend more time on their jobs than was necessary to earn their subsistence— the excess product, or surplus value thus manually created, was appropriated by the capitalist in the form of profits and rents. Bender (1988, p.7): “Profits represented that share of social wealth withdrawn from wages”. It was this rate of surplus-value around which the struggle between the proletariat—with its declining standard of living—and the owners of the means of production centred.

Because all profit results from this “exploitation of labour” the rate of profit—the amount per unit of total capital outlay—depends largely on the number of workers employed. However, in the long term, Marx envisaged rather too simplistically that with the introduction of machinery and the resulting technical efficiencies, less labour time would be required (or available for exploitation) thus yielding less surplus value and so profit was bound to decline. The competition then among capitalists would become acute, leading to monopolistic behemoths thus making exploitation more severe. Profit spirals downward and as society became chronically unable to consume all it produced, the economy will be subjected to a burgeoning array of crises—overproduction, depression and unemployment—and so bring about the inevitable revolutionary transition to communism.

MARX: “The monopoly of capital becomes a fetter upon the mode of production …Centralisation of the means of production and socialisation of labour at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.  (McLellan, 1983, pp. 47-48).

Such predictions nonetheless never materialised, at least in the manner or form Marx had advocated. What eventuated in Russia after 1917 would be almost unrecognisable to the authors of The Manifesto of the Communist Party circa 1848.  His predictions for the demise of capitalism have proven less than precise. Certainly, Marx’s identification of the tendency of industrial and business units to merge and sometimes develop amid recurring cycles of boom and gloom were close to the mark. Nevertheless, as Sabine and Thorsen (1973, p. 716) point out, as a counter measure, “corporate organisations tended to spread ownership [and risk] and to divest it of the implications of control that Marx attached to it”.

Additionally, the almost universal rise in the working class’s standard of living in industrialised countries dampens somewhat Marx’s claim that their lot would become progressively impoverished under capitalism. “Though capitalism assumed international proportions, as Marx expected, the working class of the more industrialised countries showed no tendency to unite for an international class struggle… Nor does it appear [with the advent of trade unions, joint stock operatives, employee share options and workplace bargaining initiatives et al] that capitalist industrialism sharpened class antagonism” (Sabine & Thorsen, 1973, p. 716). Seen in this light, Marx’s oft-maligned critique of capitalism, while innovative in design, exhaustive in approach and from a historical perspective, unsurpassed in scope, is justifiably excused not so much in the inadequacy of his social and economic theory as in the expectations he based on it.

Having expounded on the first role that Marx played in world history—as critic of capitalism— it is to the second that we now turn our attention, an advocate of communism. It is best to distinguish what he meant by communism and the term so often incorrectly substituted for it—socialism. For Marx, the latter was the more comprehensive of the two: communism was simply an advanced stage of socialism. Socialism was an interim measure, meant to merely prepare the way by nationalising the means of production and putting them under the control of those he viewed as the sole producers and natural inheritors of wealth—the workers.

He viewed political equality and freedom incomplete without economic equality. This proposed redistribution of economic power effectively extended democracy far beyond the parameters envisioned by earlier democratic revolutions. It is in such a peerless environment, according to Marx, where social services like health, education, housing et al would be provided and sustained that his claims for the superiority of communism can be found. Whether they are realistically achievable or not is yet to be confirmed. The failure of a purely Marxian form of communism to emerge might suggest that his claims for the system’s superiority are fundamentally suspect.

In Marx’s mind, first one country, then another would follow a specific route, until all nations had developed socialist-like economies creating an international communist society. Appearing akin to anarchism, this vision of communism was a stateless society in which central government had withered away to the point where control of all affairs was undertaken at the local level (from the ground-up) through democratic processes based at the place of work. Additionally, the market system was to be abolished—it had to, there was no money for exchange. Letters of transaction, or a crude version of cheques, was the intended substitute. The result was a system whereby people would voluntarily work for the common good to the extent that they were able to, albeit with the understanding that they could receive whatever they needed free.

This is what Marx meant by “from each according to his ability, to each according to his needs”. And he said this with a straight face. He also argued the superfluousness of national boundaries and in the wake of a pacifist society—specific to communism—the cessation of all wars. He had capitalism on the ropes. Critics (and myself) might contend Marx’s vision as utopian, an imaginary society and adjective attributed in the aftermath of Sir Thomas More’s (1478-1535) publication of Utopia (1516). In it, More described a society where luxury and greed had been banished. His intention, says Acton (1967, p. 113) was to highlight the contrast “between this ideal form of society … and the existing society in which some men were overworked and undernourished and others lived in idle luxury”.

Marx rejected this utopian notion believing subsequent socialists of More’s persuasion failed to realise the extent of class division and conflict that was essential to capitalist society, and who therefore were resigned to “enlist support for their schemes from bourgeois philanthropists and [mistakenly] set up socialist societies in the midst of capitalism, without disarming and destroying it” (Acton, 1967, p. 114).  Alternatively, Marx and Engels cited the need for a long period of re-education under socialism to effectively condition people away from the selfish orientation produced by capitalism and toward the wider, common perspective indicative of communism.

Attainable, according to Marx, but totally unsubstantiated for mine, because he dismissed the existence of egoism in human nature. There was nothing new in this type of society that had not already existed before however. Economically speaking, humankind had indeed developed, according to Marx, from a form of primeval communism at some time earlier where survival and sustenance were only achievable through a compact of communal—as opposed to the more recognisable, self—interest.

MARX: “Communism as a fully developed naturalism is humanism and as a fully developed humanism is naturalism. It is the definitive resolution of the antagonism between man and nature, and between man and man. It is the true solution of the conflict between existence and essence, between objectification and self-affirmation, between freedom and necessity, between individual and species. It is the solution of the riddle of history and knows itself to be this solution”. (Kamenka, 1983, p.150)

He, along with Engels, based this assessment on empirical studies or the materialist conception of history as espoused earlier. They sought to prove that the sharing nature of so-called primitive communist societies was as natural and widespread an attitude toward wealth as acquisition. To assert the primacy, as Marx did, that society would follow a circular logic in its reversion to “communism” is at once dismissive of any theoretical strengths or positive directions that may emerge in capitalist development. A further criticism of Marx’s projected flavour of society is the vagueness he ascribes to its final form. Statements in The Communist Manifesto like “all production [will be] concentrated in the hands of a vast association of the whole nation” and that there will be “an association in which the free development of each is the condition for the free development of all”, are so vague and ripe for utopian accusations that they are rendered ill defined and obsolete in the author’s argument for the virtues of his brand of communism.

In defense, we are products, implied Marx correctly, of our environment, particularly of the economic system in which we live. Whether serf or surfer, we are motivated (or manacled) by the prevailing economic impulses yet consider those natural and decidedly fixed. However, at certain points in history, as Marx successfully illustrated, society undergoes what is referred to as a paradigm shift in values and expectations based on an economic transformation. While the industrial revolution was indeed the catalyst for one such shift, it was the resilient nature of capitalism and not the moral merits of communism that emerged superior. For the time being at least anyway.

In Marx’s version of events, as recorded in The Communist Manifesto, the result of the paradigm shift beyond capitalism will be the elevation “of the proletariat to the position of ruling class, to win the battle of democracy … The proletariat will use its political supremacy to wrest, by degrees, all capital from the bourgeoise, to centralise all instruments of production in the hands of the State” (Fischer, 1978, p. 134).

Marx’s maxim, that there was no such thing as a static human nature, and that in fact human nature had changed many times in the past, is indisputable. By extrapolation, could it not be feasible for society to undergo another of those paradigm shifts? Marx genuinely thought so, at least in the increasingly alienating industrialised context of mid-19th century Europe. He was right about the shift, the direction he espoused however, was different. Proposing as Marx did, a circular logic to communism proved incorrect. Instead, the direction of the shift was linear and in the one and a half centuries since the unrealised revolutionary fervour of 1848, capitalism has—albeit with numerous concessions to the contemporary proletariat— consolidated its position as the most enduring form of political economy.

By any modern day analysis (or even those in Marx’s lifetime) the disproved supposition of the surplus-value of labour, complete with its as yet seen cancerous implications for the existing economy, somewhat undermines the Marxist dialectic of the capitalist’s domain. This is not to dismiss Marx altogether. While the doctrine that bears his name encountered the unforeseen and unacknowledged potential of the resilience of Western capitalism and witnessed the unfortunate demise of hybrid socialist societies in the East, Marxism can genuinely be considered, in the words of Ninian Smart (1998), “a world view, with a religious flavour, not directed towards a high world but towards the transformation of this”. Smart, I believe, puts into perspective a more definitive appraisal of Marxism’s sociological legacy:

“For doctrines, it had the writings of Marx, Engels … and others. For myth, it had the pulsating rhythm of history, culminating in the earthly paradise of a classless society. For ethics, it had the ceaseless pursuit of social justice and the maintenance of class struggle. For practice, it had the need to realise theories concretely in revolutionary activity. For experience, it had the nurturing of ardour and hatred toward class enemies. For organisation, it had the various communist parties”.

Even with such a glowing eulogy and a poor political record, and in its analysis of persisting economic inequality both inside nation states and between them, and of the concomitant systems of power and domination, together with a critique of such arrangements, Marxism can claim to be the most influential paradigm of our age.

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