Marx May Have Had a Point

Hitting the mainpage for the first time, Black Sabbath writes "While communism has been declared dead and buried (with a few stubborn exceptions), Karl Marx's diagnosis of capitalism's ills seem quite bang on the money. Harvard Business Review blogger Umair Haque lists where Marx may have been right." It's a pretty good read once you get past the author's three paragraph disclaimer that he is not a communist. The MIT news also ran a short interview discussing the economic trends in August this morning.

Comments

Nothing to surprising

[Squiddie]

I think everyone knew that even Capitalism has its down sides, we just agreed that they were acceptable. Yeah, he may have been right, but it's nothing we didn't already know.

Re:Nothing to surprising

[geekmux]

And yet under communist rule there are still wealthy power brokers who know how to game the system for their own profit.

Corruption is corruption, no matter what "wrapper" we put around it. Greed (whether personal or financial) always has been and always will be the Achilles heel of ANY model. Every model will fail if greed and corruption are left unchecked. Again, this should come as no surprise to anyone.

Re:Nothing to surprising

[zixxt]

It has been tried but not under the term Communism. There was a form of primitive Communism in the Bible read the book of Acts. So yes Christianity and socialism are very compatible.

Acts 2

44: And all that believed were together, and had all things common; 45: And sold their possessions and goods, and parted them to all men, as every man had need.

Acts 4

32: And the multitude of them that believed were of one heart and of one soul: neither said any of them that ought of the things which he possessed was his own; but they had all things common. 33: And with great power gave the apostles witness of the resurrection of the Lord Jesus: and great grace was upon them all. 34: Neither was there any among them that lacked: for as many as were possessors of lands or houses sold them, and brought the prices of the things that were sold, 35: And laid them down at the apostles' feet: and distribution was made unto every man according as he had need. 36: And Joses, who by the apostles was surnamed Barnabas, (which is, being interpreted, The son of consolation,) a Levite, and of the country of Cyprus, 37: Having land, sold it, and brought the money, and laid it at the apostles' feet.

Re:Nothing to surprising

[Smallpond]

There is no way to implement what Marx theorized about. That's the whole point. Once the theory hits the real world, human nature screws it up.

Exactly. Communism is based on the idea that people are willing to give up their own self-interest to advance the collective. This is pretty much like the Prisoner's Dilemma. Even though people may be "educated" to agree with the general principle, when it comes down to individual choices, people tend to do what's best for themselves.

Re:Nothing to surprising

[mcvos]

It's true for both. Communism assumes people are not greedy, capitalism assumes people are rational and informed. Neither are true.

Re:Nothing to surprising

[h4rr4r]

I am no philosophy type, and I realize that nothing is black and white. My only objection here was comparing the USSR to what Marx wrote about is insane. The USSR and its leaders never intended to put such a system in place or even attempt to. They used these words as a propaganda tool. Just like the "American Dream" is used as a propaganda tool to keep the poor from rioting in the streets when they find out Buffet pays less taxes(percentage wise) than his secretary.

Re:Nothing to surprising

[UnknownSoldier]

> That's because communism has never been tried. A communist regime in the model that Marx was pushing hasn't ever been implemented.

Oh please. Have you even _read_ the Communist Manifesto or even know what "allodial title" means??

I'll repeat them here for your benefit ...

1. "Abolition of property in land and application of all rents of land to public purposes.
2. A heavy progressive or graduated income tax.
3. Abolition of all right of inheritance.
4. Confiscation of the property of all emigrants and rebels.
5. Centralization of credit in the hands of the state, by means of a national bank with state capital and an exclusive monopoly.
6. Centralization of the means of communication and transport in the hands of the state.
7. Extension of factories and instruments of production owned by the state; the bringing into cultivation of wastelands, and the improvement of the the soil generally in accordance with a common plan.
8. Equal liability of all to labor. Establishment of industrial armies, especially for agriculture.
9. Combination of agriculture with manufacturing industries, gradual abolition of the distinction between town and country, by a more equitable distribution of the populace over the country.
10. Free education for all children in public schools. Abolition of children's factory labor in its present form."

And quoting the excellent analysis ....

- - - 8http://www.buildfreedom.com/tl/wua11.shtml

1. Abolition of Property Rights.

U.S. Constitution, Article 1, Section 8: The Congress shall have the power to lay and collect taxes, duties, imposts and excises. (Taxes on things, including property.)
Zoning laws and regulations - the Supreme Court ruled zoning constitutional in 1921.
Federal ownership of land; Bureau of Land Management - in Nevada 87% of land is federally owned.
Federal Emergency Management Agency (FEMA) - broad powers to seize any private property during "emergency."

Communist percentage: 25%.

2. Heavy Progressive Income Tax

U.S. Constitution, Article 1, Section 8: The Congress shall have the power to lay and collect taxes, duties, imposts and excises. (Taxes on things, including income.) The Sixteenth Amendment classifies income tax as an indirect tax, or tax on a thing, as opposed to tax on a person.
Corporate Tax Act of 1909.
Revenue Act of 1913.
Social Security Act of 1936.

Communist percentage: 85%. (Maybe 15% of the population don't pay the taxes.)

3. Abolition of Rights of Inheritance

U.S. Constitution, Article 1, Section 8: The Congress shall have the power to lay and collect taxes, duties, imposts and excises. (Taxes on things, including inheritances.)
Estate Tax Act of 1916.
Social Security Act of 1936.

Communist percentage: 30%.

4. Confiscation of Property of Emigrants and Rebels

Confiscation of property of American Indians.
IRS confiscation of property without due process.
Internment of Japanese-Americans during WW II; confiscation of their property.
Confiscation of drug-merchant property.
RICO Act of 1970 (Racketeering Influenced & Corrupt Organizations) - used as a basis to confiscate property.

Communist percentage: 20%.

5. Monopoly National Bank

U.S. Constitution, Article 1, Section 8: The Congress shall have the power to coin money, r

Re:Nothing to surprising

[pdabbadabba]

I think this isn't quite right. Marx believed that you could transform man's greed for material wealth into greed for something else, not that it could be eliminated.

Marx, being a Hegelian, believed that man's psychology could be altered through social changes; he thought that changes in social structure could create corresponding in the peoples' incentive structure. Thus, in a successful Marxist state as Marx envisioned it, peoples' greed for gold would be replaced with a zeal for contributing to society (and, perhaps, greed for the social recognition that would come from those contributions). So, in a way, a successful communist system would be as much driven by greed as a capitalist one.

It may not be possible, of course, to modify peoples' incentives in this way, though it's never truly been tested since the prerequisite social structure has never actually been created (and I don't think it's accurate to say he "assumed" that they could; it was certainly something he explicitly argued for). It doesn't seem crazy on its face, though, that people can be conditioned socially to value something other than material wealth.

Re:Nothing to surprising

[wwfarch]

I agree with this and will add a bit. The failing of capitalism is not in accounting for greed. For capitalism to work you need an educated consumer base. This is where capitalism fails in reality. Marketers intentionally deceive consumers which wouldn't be a problem with an educated consumer base (they would be able to catch the deception). The problem is that it's literally impossible to be educated about all products on the market so you simply can't have the educated consumer base necessary for free markets to operate as theories would indicate.

Re:Nothing to surprising

[tmosley]

Everyone who wants to discuss Marx should read this first: http://fofoa.blogspot.com/2010/07/debtors-and-savers.html

The author identifies the fundamental flaw with Marx's theory--he used a false premise. The author here starts a corrected premise and proceeds to give a very interesting history lesson, one which applies quite strongly to today's economic environment.

Re:Nothing to surprising

[iluvcapra]

But the market corrects over time, that is what it does and it is as relentless as water on stone. Government on the other hand is also made up of the same human actors, but because it has a monopoly on the use of force is much slower to realize its mistakes and thus to correct them.

"The market can stay irrational longer than you can stay solvent." The question of the stability of laissez-faire is bound up in the question of how many people are forced to encounter this rule, and to what extreme.

Government on the other hand is also made up of the same human actors, but because it has a monopoly on the use of force is much slower to realize its mistakes and thus to correct them.

The GP notwithstanding, we feel compelled to remember that Marxism is characteristically anti-statist and anti-authoritarian, and that socialist and labor movements in most of the world until World War I were dedicated to reducing the size and scope of the state -- labor unions and syndicates were developed as non-state methods of social provision and welfare, and were defended from state encroachment, because actual state welfare was seen by communists as the state "buying off" support from the proletariat, which in the case at least of Germany under Bismarck, was explicitly the goal.

What's fascinating is that through that whole period the political cultures of Europe, and to a large extent the US, accepted the terms of Marxist debate on the issue and accepted that there was such a thing as a capitalist, and a proletariat (called a "working class"), a meaningful relation between labor and value, the whole mess.

The socialist and labor parties of Europe in the first decade of the 20th century split over the question of wether or not you could be a socialist and be a parliamentarian, or government official, without contradiction. It was a really big issue and the source of bitter debate! And many labor and socialist leaders refused to become a part of the government on principle.

Contrast with the arguments over wether or not someone can truly stand for the values of the "TEA Party" and a member of congress.

What is possible is to design a system which can operate in an imperfect world populated by imperfect humans. That system is a Republican form of government given the absolute minimum power required to perform those few things that the Free People associating freely can't do for themselves.

The challenge is, how imperfect can the country get before people are unwilling to fight and die for it, are unwilling to ally with it, support it, vote in its elections, or do business in it. If someone's grandparents are living destitute and their job is miserable and their kid owes $100k in student loans and can't find a job, it's not going to matter a flying fuck how much "free people associating freely" is going on. Freedom is not an alibi for misery.

Democracy is a way (not the only way, but a way) of giving people a stake and responsibility in the system. The system in the US is specifically antidemocratic, and does a terrible job of registering preferences through elections, and the result is that when the US is "imperfect," its people increasingly don't see it as their problem or responsibility.

Re:Nothing to surprising

[GospelHead821]

I think that your comment highlights a key weakness of capitalism. In practice, government is not operated independently of business and the politicians in charge of regulating business (minimally, in the ideal case) are also trying to look out for their own best interests. I'd argue that in such a system, the only two negotiable instruments are, ultimately, money and power. Under such circumstances, corruption is inevitable. The wealthy and the influential will collude. leaving the middle and lower classes (those with minimal money and power) out of the conversation. They key question that capitalism must address, in my opinion, is how does a society prevent the wealthy and the influential from colluding, to the detriment of everybody else?

Political term limits might be one way to start. Restrictions on corporate political activism might be another. (I'm sorry; corporations are not people and should not enjoy "free speech" in the same manner as a human citizen.) Of course, either method could backfire. Term limits might induce politicians to grab what they can, while they can. Restrictions on corporate political activism might just drive it underground. I don't have a great answer to the problem but I think it's one to which a lot of attention should be devoted.

Re:Nothing to surprising

[MartinSchou]

Put 4 or 6 minimum wage people into that same apartment.

Will get you kicked out of that 270 square foot apartment - not to mention that there's barely room for the beds.

Or move back in with your parents.

Dead, only child, parents lived in an apartment.

I started out as an office clerk making $4 an hour back in 1980.

4 USD in 1980 equals 10.44 USD in 2010. By comparison the Federal minimum wage is 7.25 USD, and Washington has the highest minimum wage of 8.67. In other words, in 2010 dollars, you made between 20 and 44 percent more than minimum wage.

I lived paycheck to paycheck for many years

Now cut that paycheck between the aforementioned 20 and 44. Assuming you only worked 40 hours a week back then, you'd now have to work between 48 and 58 hours a week to make the same paycheck, which would cut significantly into your available time for self-improvement.

Long-Term or Short-Term Trends?

[thepainguy]

Would you rather be poor in Marx's day or today? It seems to me that today's poor have it pretty good, considering.

You could also argue that a big part of the problem of late is people living beyond their means. A nice, but modest, suburban home like the one you grew up in is no longer acceptable. Now, you need a McMansion, and that drives the overextension and the debt. Just watch any of the "Real Housewives" shows.

In terms of immiseration, the problem isn't exploitation but globalization (and cheap transport and communications). Back in the day, you competed for wages largely with people in your own country. Now, you're competing with workers from around the world.

"See this suspicious looking brown guy? He's a.."

[Brian Stretch]

"card carrying communist!!"

Given that a suspicious looking brown guy whose political mentor in Chicago was a communist domestic terrorist has been elected President, I think you're safe Haque.

(Let the battle between "+1 Funny" and "-1 Troll" commence!)

Re:Scope of Effect

[mfnickster]

Under capitalism, you can have companies that exploit workers but if they do that too much workers are free to leave and start new companies that start afresh... at least you have that ability as long as regulations do not impose too heavy a burden to start a new company to compete.

Regulations, schmegulations. The reason small businesses can't compete is because big business has rigged the game to their favor, and the playing field is no longer level.

Marx was EXACTLY right in his diagnosis

[Jeremiah Cornelius]

He created a flawed mechanism for analysing history. Like the Flinstones, he comically projects an 18th/19th century social relationships, back to the dawn of civilisation.

I used to jest that the Marxist deconstruction of the Jurassic revealed that it was a class struggle between herbivorous dinosaurs and large meat-eaters.

Despite this near-sightedness, Marx was EXACTLY right in his diagnosis of the evils, ills and discontents of market capitalism.

And he was just as flawed, to an equal extent, in his prescription for those evils.

The truth is, those who exploited market capitalism for exclusivity of wealth, power and domination were just as empowered to do the same thing with the intellectual and social methods of Marx's "revolution".

And really. When it comes down to it, how is the organisation of the modern corporation, with it's CEO, directors, officers and hierarchy of management bearing Q10's and quarterly projections any different from the Supreme Soviet, commissars, apparatchiks and 5-year plans? Not at all.