It is true that as the financial and economic crises roll on, as more and more disasters accumulate, as more people are thrown into unemployment and suffering that more and more of us will question the fundamentals of our economic system. It is inevitable that many will be drawn to some of the criticisms of capitalism, including Marxism.
The Guardian today published a salutary overview of this revival:
In his introduction to a new edition of The Communist Manifesto, Professor Eric Hobsbawm suggests that Marx was right to argue that the “contradictions of a market system based on no other nexus between man and man than naked self-interest, than callous ‘cash payment’, a system of exploitation and of ‘endless accumulation’ can never be overcome: that at some point in a series of transformations and restructurings the development of this essentially destabilising system will lead to a state of affairs that can no longer be described as capitalism”.
That is post-capitalist society as dreamed of by Marxists. But what would it be like? “It is extremely unlikely that such a ‘post-capitalist society’ would respond to the traditional models of socialism and still less to the ‘really existing’ socialisms of the Soviet era,” argues Hobsbawm, adding that it will, however, necessarily involve a shift from private appropriation to social management on a global scale. “What forms it might take and how far it would embody the humanist values of Marx’s and Engels’s communism, would depend on the political action through which this change came about.”
Marxism is a strange thing; it provides a clean and straightforward narrative of history, one that irons out detail and complication. It provides a simplistic “us versus them” narrative of the present. And it provides a relatively utopian narrative of the future; that the working classes united will overthrow capitalism and establish a state run by and for the working classes.
Trouble is, history is vastly more complicated than the teleological narrative provided by dialectical materialism. The economic and social reality of the present is vastly more complicated than Marx’s linear and binary classifications. And the future that Marx predicted never came to fruit; his 19th Century ideas turned into a 20th Century reality of mass starvation, failed central planning experiments, and millions of deaths.
Certainly, the system we have today is unsustainable. The state-supported financial institutions, and the corporations that have grown up around them do not live because of their own genius, their own productivity or innovation. They exist on state largesse — money printing, subsidies, limited liability, favourable regulation, barriers to entry. Every blowup and scandal — from the LIBOR-rigging, to the London Whale, to the bungled trades that destroyed MF Global — illustrates the incompetence and failure that that dependency has allowed to flourish.
The chief problem that Marxists face is their misidentification of the present economic system as free market capitalism. How can we meaningfully call a system where the price of money is controlled by the state a free market? How can we meaningfully call a system where financial institutions are routinely bailed out a free market? How can we meaningfully call a system where upwards of 40% of GDP is spent by the state a free market? How can we call a system where the market trades the possibility of state intervention rather than underlying fundamentals a free market?
Today we do not have a market economy; we have a corporate economy.
As Saifedean Ammous and Edmund Phelps note:
The term “capitalism” used to mean an economic system in which capital was privately owned and traded; owners of capital got to judge how best to use it, and could draw on the foresight and creative ideas of entrepreneurs and innovative thinkers. This system of individual freedom and individual responsibility gave little scope for government to influence economic decision-making: success meant profits; failure meant losses. Corporations could exist only as long as free individuals willingly purchased their goods – and would go out of business quickly otherwise.
Capitalism became a world-beater in the 1800’s, when it developed capabilities for endemic innovation. Societies that adopted the capitalist system gained unrivaled prosperity, enjoyed widespread job satisfaction, obtained productivity growth that was the marvel of the world and ended mass privation.
Now the capitalist system has been corrupted. The managerial state has assumed responsibility for looking after everything from the incomes of the middle class to the profitability of large corporations to industrial advancement. This system, however, is not capitalism, but rather an economic order that harks back to Bismarck in the late nineteenth century and Mussolini in the twentieth: corporatism.
The system of corporatism we have today has far more akin with Marxism and “social management” than Marxists might like to admit. Both corporatism and Marxism are forms of central economic control; the only difference is that under Marxism, the allocation of capital is controlled by the state bureaucracy-technocracy, while under corporatism the allocation of capital is undertaken by the state apparatus in concert with large financial and corporate interests. The corporations accumulate power from the legal protections afforded to them by the state (limited liability, corporate subsidies, bailouts), and politicians can win re-election showered by corporate money.
The fundamental choice that we face today is between economic freedom and central economic planning. The first offers individuals, nations and the world a complex, multi-dimensional allocation of resources, labour and capital undertaken as the sum of human preferences expressed voluntarily through the market mechanism. The second offers allocation of resources, labour and capital by the elite — bureaucrats, technocrats and special interests. The first is not without corruption and fallout, but its various imperfect incarnations have created boundless prosperity, productivity and growth. Incarnations of the second have led to the deaths by starvation of millions first in Soviet Russia, then in Maoist China.
Marxists like to pretend that the bureaucratic-technocratic allocation of capital, labour and resources is somehow more democratic, and somehow more attuned to the interests of society than the market. But what can be more democratic and expressive than a market system that allows each and every individual to allocate his or her capital, labour, resources and productivity based on his or her own internal preferences? And what can be less democratic than the organisation of society and the allocation of capital undertaken through the mechanisms of distant bureaucracy and forced planning? What is less democratic than telling the broad population that rather than living their lives according to their own will, their own traditions and their own economic interests that they should instead follow the inclinations and orders of a distant bureaucratic-technocratic elite?
I’m not sure that Marxists have ever understood capitalism; Das Kapital is a mammoth work concentrating on many facets of 19th Century industrial and economic development, but it tends to focus in on obscure minutiae without ever really considering the coherent whole. If Marxists had ever come close to grasping the broader mechanisms of capitalism — and if they truly cared about democracy — they would have been far less likely to promulgate a system based on dictatorial central planning.
Nonetheless, as the financial system and the financial oligarchy continue to blunder from crisis to crisis, more and more people will surely become entangled in the seductive narratives of Marxism. More and more people may come to blame markets and freedom for the problems of corporatism and statism. This is deeply ironic — the Marxist tendency toward central planning and control exerts a far greater influence on the policymakers of today than the Hayekian or Smithian tendency toward decentralisation and economic freedom.
azizonomics 
Good post Aziz. I am in general agreement with you on Marxism. I think what we don’t want is FASCISM.
Have you considered the work of Henry George? I would like to hear your thoughts on rent-seeking as espoused by Henry George. This link is a chapter from George’s book ‘Progress and Poverty’ on rent and its associated ills.
I think the free market capitalists ignore the ills of private ownership of natural resources and its associated problem of rent-seeking. Partaking in the results of production without actually producing anything at all is a big problem we have today.
Henry George is a really interesting guy, but the issue is that if land and resources are not privately owned, who owns them? The answer is some form of government, which by definition seems to lead to misallocation of resources due to distance, due to inefficiencies of bureaucracy, due to lack of a market feedback mechanism, i.e. the same problems with Marxism. Certainly, some governments are less bad in terms of capital misallocation, but nothing beats the expressed preferences of society, i.e. the market.
Rent-seeking is very much a problem of corporatism, not capitalism. You only get these kinds of bottlenecks in a rigged-market kind of environment. Otherwise, the inefficient cartels and rent-seekers can usually be beaten on price/efficiency/popularity.
Aziz,
/* You only get these kinds of bottlenecks in a rigged-market kind of environment. Otherwise, the inefficient cartels and rent-seekers can usually be beaten on price/efficiency/popularity.*/
You don’t trust the State to efficiently allocate the land resources. Fair enough, but you trust the State to be incorruptible in the face of rising corporate power? Why does capitalism devolve into a rigged market kind of environment? The reason is that humans are fallible, we’ve always been. Never perfect.
Free-market is an idealistic utopia, purely because humans are subject to entropy and deterioration as much as the universe is.
I think George does not preclude usage or market-allocation of land, but eventually the land/natural resource owners need to pay rents to the State, which forms the State’s revenue. If we agree that we need a State, what is the best form of revenue that the State can seek? Best form = least disruptive from a market point of view. That would be the rents.
Regardless of the monetary system, rents always exist. Rent is a privilege and George looks to have made the distinction between wealth that is rightfully earned and wealth that is grabbed through mere ownership. Marx failed to make this distinction.
This is why I favour decentralised power; the less power in the hands of the state, the less value there is in buying it out. Capitalism, in my view, degenerates into corporatism because industrialists lobby to create large and expansive states that they can use to rig markets and enforce their own power. The answer is to resist the creation of the large expansive state.
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“I’m not sure that Marxists have ever understood capitalism;”
And I am not sure if you understand Marxism!
Here’s Lenin on the subject, from his book “Imperialism, the highest stage of capitalism”:
Half a century ago, when Marx was writing Capital, free competition appeared to the overwhelming majority of economists to be a “natural law”. Official science tried, by a conspiracy of silence, to kill the works of Marx, who by a theoretical and historical analysis of capitalism had proved that free competition gives rise to the concentration of production, which, in turn, at a certain stage of development, leads to monopoly. Today, monopoly has become a fact. Economists are writing mountains of books in which they describe the diverse manifestations of monopoly, and continue to declare in chorus that “Marxism is refuted”. But facts are stubborn things, as the English proverb says, and they have to be reckoned with, whether we like it or not. The facts show that differences between capitalist countries, e.g., in the matter of protection or free trade, only give rise to insignificant variations in the form of monopolies or in the moment of their appearance; and that the rise of monopolies, as the result of the concentration of production, is a general and fundamental law of the present stage of development of capitalism.
For Europe, the time when the new capitalism definitely superseded the old can be established with fair precision; it was the beginning of the twentieth century. In one of the latest compilations on the history of the “formation of monopolies”, we read:
“Isolated examples of capitalist monopoly could be cited from the period preceding 1860; in these could be discerned the embryo of the forms that are so common today; but all this undoubtedly represents the prehistory of the cartels. The real beginning of modern monopoly goes back, at the earliest, to the sixties. The first important period of development of monopoly commenced with the international industrial depression of the seventies and lasted until the beginning of the nineties.” “If we examine the question on a European scale, we will find that the development of free competition reached its apex in the sixties and seventies. It was then that Britain completed the construction of her old-style capitalist organisation. In Germany, this organisation had entered into a fierce struggle with handicraft and domestic industry, and had begun to create for itself its own forms of existence.”
“The great revolution commenced with the crash of 1873, or rather, the depression which followed it and which, with hardly discernible interruptions in the early eighties, and the unusually violent, but short-lived boom round about 1889, marks twenty-two years of European economic history … .. During the short boom of 1889-90, the system of cartels was widely resorted to in order to take advantage of favourable business conditions. An ill-considered policy drove prices up still more rapidly and still higher than would have been the case if there had been no cartels. and nearly all these cartels perished ingloriously in the smash. Another five-year period of bad trade and low prices followed, but a new spirit reigned in industry; the depression was no longer regarded as something to be taken for granted: it was regarded as nothing more than a pause before another boom.
“The cartel movement entered its second epoch: instead of being a transitory phenomenon, the cartels have become one of the foundations of economic life. They are winning one field of industry after another, primarily, the raw materials industry. At the beginning of the nineties the cartel system had already acquired-in the organisation of the coke syndicate on the model of which the coal syndicate was later formed—a cartel technique which has hardly been improved on. For the first time the great boom at the close of the nineteenth century and the crisis of 1900-03 occurred entirely—in the mining and iron industries at least—under the aegis of the cartels. And while at that time it appeared to be something novel, now the general public takes it for granted that large spheres of economic life have been, as a general rule, removed from the realm of free competition.”
Thus, the principal stages in the history of monopolies are the following: (1) 1860-70, the highest stage, the apex of development of free competition; monopoly is in the barely discernible, embryonic stage. (2) After the crisis of 1873, a lengthy period of development of cartels; but they are still the exception. They are not yet durable. They are still a transitory phenomenon. (3) The boom at the end of the nineteenth century and the crisis of 1900-03. Cartels become one of the foundations of the whole of economic life. Capitalism has been transformed into imperialism.
Cartels come to an agreement on the terms of sale, dates of payment, etc. They divide the markets among themselves. They fix the quantity of goods to be produced. They fix prices. They divide the profits among the various enterprises, etc.
At times cartels and trusts concentrate in their hands seven- or eight-tenths of the total output of a given branch of industry. The Rhine-Westphalian Coal Syndicate, at its foundation in 1893, concentrated 86.7 per cent of the total coal output of the area, and in 1910 it already concentrated 95.4 per cent. The monopoly so created assures enormous profits, and leads to the formation of technical production units of formidable magnitude. The famous Standard Oil Company in the United States was founded in 1900: “It has an authorised capital of $150,000,000. It issued $100,000,000 common and $106,000,000 preferred stock. From 1900 to 1907 the following dividends were paid on the latter: 48, 48, 45, 44, 36, 40, 40, 40 per cent in the respective years, i.e., in all, $367,000,000. From 1882 to 1907, out of total net profits amounting to $889,000,000, $606,000,000 were distributed in dividends, and the rest went to reserve capital.
[…]
In German large-scale industry, e.g., in the chemical industry, which has developed so enormously during these last few decades, the promotion of technical improvement is organised in the same way. By 1908 the process of concentration of production had already given rise to two main “groups” which, in their way, were also in the nature of monopolies. At first these groups constituted “dual alliances” of two pairs of big factories, each having a capital of from twenty to twenty-one million marks-on the one hand, the former Meister Factory in Hochst and the Casella Factory in Frankfurt am Main; and on the other hand, the aniline and soda factory at Ludwigshafen and the former Bayer Factory at Elberfeld. Then, in 1905, one of these groups, and in 1908 the other group, each concluded an agreement with yet another big factory. The result was the formation of two “triple alliances”, each with a capital of from forty to fifty million marks. And these “alliances” have already begun to “approach” each other, to reach “an understanding” about prices, etc.
Competition becomes transformed into monopoly. The result is immense progress in the socialisation of production. In particular, the process of technical invention and improvement becomes socialised.
This is something quite different from the old free competition between manufacturers, scattered and out of touch with one another, and producing for an unknown market. Concentration has reached the point at which it is possible to make an approximate estimate of all sources of raw materials (for example, the iron ore deposits) of a country and even, as we shall see, of several countries, or of the whole world. Not only are such estimates made, but these sources are captured by gigantic monopolist associations. An approximate estimate of the capacity of markets is also made, and the associations “divide” them up amongst themselves by agreement. Skilled labour is monopolised, the best engineers are engaged; the means of transport are captured—railways in America, shipping companies in Europe and America. Capitalism in its imperialist stage leads directly to the most comprehensive socialisation of production; it, so to speak, drags the capitalists, against their will and consciousness, into some sort of a new social order, a transitional one from complete free competition to complete socialisation.
Production becomes social, but appropriation remains private. The social means of production remain the private property of a few. The general framework of formally recognised free competition remains, and the yoke of a few monopolists on the rest of the population becomes a hundred times heavier, more burdensome and intolerable.
The German economist, Kestner, has written a book especially devoted to “the struggle between the cartels and outsiders”, i.e., the capitalists outside the cartels. He entitled his work Compulsory Organisation, although, in order to present capitalism in its true light, he should, of course, have written about compulsory submission to monopolist associations. It is instructive to glance at least at the list of the methods the monopolist associations resort to in the present-day, the latest, the civilised struggle for “organisation”: (1) stopping supplies of raw materials … “one of the most important methods of compelling adherence to the cartel”); (2) stopping the supply of labour by means of “alliances” (i.e., of agreements between the capitalists and the trade unions by which the latter permit their members to work only in cartelised enterprises); (3) stopping deliveries; (4) closing trade outlets; (5) agreements with the buyers, by which the latter undertake to trade only with the cartels; (6) systematic price cutting (to ruin “outside” firms, i.e., those which refuse to submit to the monopolists. Millions are spent in order to sell goods for a certain time below their cost price; there were instances when the price of petrol was thus reduced from 40 to 22 marks, i.e., almost by half!); (7) stopping credits; (8) boycott.
Here we no longer have competition between small and large, between technically developed and backward enterprises. We see here the monopolists throttling those who do not submit to them, to their yoke, to their dictation. This is how this process is reflected in the mind of a bourgeois economist:
“Even in the purely economic sphere,” writes Kestner, “a certain change is taking place from commercial activity in the old sense of the word towards organisational-speculative activity. The greatest success no longer goes to the merchant whose technical and commercial experience enables him best of all to estimate the needs of the buyer, and who is able to discover and, so to speak, ‘awaken’ a latent demand; it goes to the speculative genius [?!] who knows how to estimate, or even only to sense in advance, the organisational development and the possibilities of certain connections between individual enterprises and the banks. . . .”
Translated into ordinary human language this means that the development of capitalism has arrived at a stage when, although commodity production still “reigns” and continues to be regarded as the basis of economic life, it has in reality been undermined and the bulk of the profits go to the “geniuses” of financial manipulation. At the basis of these manipulations and swindles lies socialised production; but the immense progress of mankind, which achieved this socialisation, goes to benefit . . . the speculators. We shall see later how “on these grounds” reactionary, petty-bourgeois critics of capitalist imperialism dream of going back to “free”, “peaceful”, and “honest” competition.
[…]
Domination, and the violence that is associated with it, such are the relationships that are typical of the “latest phase of capitalist development”; this is what inevitably had to result, and has resulted, from the formation of all-powerful economic monopolies.
[…]
capitalism only became capitalist imperialism at a definite and very high stage of its development, when certain of its fundamental characteristics began to change into their opposites, when the features of the epoch of transition from capitalism to a higher social and economic system had taken shape and revealed themselves in all spheres. Economically, the main thing in this process is the displacement of capitalist free competition by capitalist monopoly. Free competition is the basic feature of capitalism, and of commodity production generally; monopoly is the exact opposite of free competition, but we have seen the latter being transformed into monopoly before our eyes, creating large-scale industry and forcing out small industry, replacing large-scale by still larger-scale industry, and carrying concentration of production and capital to the point where out of it has grown and is growing monopoly: cartels, syndicates and trusts, and merging with them, the capital of a dozen or so banks, which manipulate thousands of millions. At the same time the monopolies, which have grown out of free competition, do not eliminate the latter, but exist above it and alongside it, and thereby give rise to a number of very acute, intense antagonisms, frictions and conflicts. Monopoly is the transition from capitalism to a higher system.
If it were necessary to give the briefest possible definition of imperialism we should have to say that imperialism is the monopoly stage of capitalism. Such a definition would include what is most important, for, on the one hand, finance capital is the bank capital of a few very big monopolist banks, merged with the capital of the monopolist associations of industrialists; and, on the other hand, the division of the world is the transition from a colonial policy which has extended without hindrance to territories unseized by any capitalist power, to a colonial policy of monopolist possession of the territory of the world, which has been completely divided up.
But very brief definitions, although convenient, for they sum up the main points, are nevertheless inadequate, since we have to deduce from them some especially important features of the phenomenon that has to be defined. And so, without forgetting the conditional and relative value of all definitions in general, which can never embrace all the concatenations of a phenomenon in its full development, we must give a definition of imperialism that will include the following five of its basic features:
(1) the concentration of production and capital has developed to such a high stage that it has created monopolies which play a decisive role in economic life; (2) the merging of bank capital with industrial capital, and the creation, on the basis of this “finance capital”, of a financial oligarchy; (3) the export of capital as distinguished from the export of commodities acquires exceptional importance; (4) the formation of international monopolist capitalist associations which share the world among themselves, and (5) the territorial division of the whole world among the biggest capitalist powers is completed. Imperialism is capitalism at that stage of development at which the dominance of monopolies and finance capital is established; in which the export of capital has acquired pronounced importance; in which the division of the world among the international trusts has begun, in which the division of all territories of the globe among the biggest capitalist powers has been completed.
Even if i buy into the teleological dialectical materialist idea that capitalism necessarily creates monopolisation (I don’t — I think there is much more evidence for Schumpeterian cycles of creative destruction where monopolies end up making themselves irrelevant precisely BECAUSE they can take control of an industry, and rig the market, thus gradually rendering themselves inefficient and eventually self-destructing — e.g. the financial industry today), why should I buy into the idea that an even greater monopoly (i.e. statism, or in a more utopian vision, communism) will fix the problem of monopolism?
Thank you for pointing out the inherent double-standard in Marxism. I have a friend whom I debate with constantly who has been calling for the end of capitalism because corporations control our lives. I always point out two flaws in his argument: 1) What we have isn’t capitalism and 2) If you’re going to concentrate power, I’d at least rather have it concentrated in the hands of Corporations than in the hands of the Gov’t. With corporations at least there is some (albeit minor) chance of retribution.
Their arguments to revert to anarchy and take away all government, and have nobody own anything is just pure craziness. People think Ron Paul is nuts and then bring up a situation where we go back to trading cows for chickens and there are no laws in place if someone burns your hut down.You can’t operate a society without some rule structure, and you can’t make or enforce rules without some form of gov’t. Game over, Marxists.
Yes — it’s a horrible contradiction.
If we build from the perspective of personal independence, we will come much, much closer to the kind of concentration of power I believe will be best for liberty, i.e. dissolved and thinly-spread.
And the beautiful thing is we can free ourselves — we don’t need a revolution. Decentralisation can’t begin from a central command or revolution. We have to begin by making ourselves independent, creating our own food self-sufficiency, water self-sufficiency, energy self-sufficiency, building local communities and trade networks. With things like solar panels, greenhouses, wind turbines this is becoming easier and easier. That way, we become less dependent on the state, the financial system and the monied corporations built up around it.
Your ‘rebuttals’ leave much to be desired.
(1) This is capitalism. Libertarians tend to have a degree of cognitive dissonance where they separate the government and private enterprise, then define anything that they see as involving the ‘government’ side of the equation as outside capitalism. However, this is simply false. The state is not the opposite of capitalism but the primary instrument through which it operates, always has been. It’s hard to name a time in (capitalism’s) history when the state was not in bed with capitalists, financiers and landlords, including its inception where alws were passed to force peasants off their land and into wage labour.
(2) Marx was about as enthusiastic about central planning as Rothbard was about it. Actually he barely (perhaps never) wrote about it. Socialism is about worker ownership of production, perhaps with state ownership of utilities etc.
So the answer to eventual private monopolies is state monopoly on everything now? Lenin’s lie has been believed by billions. Of course, there was nothing in it for him lol!!
Monopolies controlled by capitalists are a natural evolution of a specialist handicraft tradesman growing in power because they make a product that the people really want.
If the Cola industry was controlled by Communists we would have endless litres of cola that nobody likes drinking.
Coca Cola is a case in point.
Nike Air
These companies are virtual monopolies, not because they regulate competitors but because they are desired.
I would prefer a monopoly with long production runs and economies of scale that produces a product people want, which is then taxed on excess profits, which recycle back into the economy to fund nation building projects, than some communist bureaucrat directed industry.
“How can we meaningfully call a system where the price of money is controlled by the state a free market? How can we meaningfully call a system where financial institutions are routinely bailed out a free market? How can we meaningfully call a system where upwards of 40% of GDP is spent by the state a free market? How can we call a system where the market trades the possibility of state intervention rather than underlying fundamentals a free market?”
Love that paragraph!
I try and tell the truth.
At the grass roots level, of course, capitalism fails quite often. F’rinstance: http://www.news4jax.com/news/South-Florida-lifeguard-fired-after-saving-man/-/475880/15403116/-/5ditk1/-/index.html
What failed there? Some guy lost his job and then got his job back? That’s just labour relations.
If people expect markets to always deliver what they believe to be “right” then they’re hoping for something impossible. Markets deliver a lot of mess, but it’s the end-result that counts, and the end result is almost always vastly more in-tune with what the majority of society wanted than what you get under central economic planning.
What failed? Are you kidding? Had the “market” decided, somebody would have drowned for arbitrary reasons of zoning. In practical terms, there are a lot of high risk ventures about which little is known and you only get one shot. In economics theory, everyone has all the information and makes a rational decision. In reality, the screaming pain from your abdomen forces you into the emergency room at 2:00 am and the fact that the anesthesiologist isn’t on your insurance nearly bankrupts you – another failure of capitalism to fulfill basic human needs.
And if it doesn’t do *that*, what’s it for?
Do you not see that the lifeguard’s impulse to save the life of the guy is part of the market process?
His employer’s bureaucratic regulations were rendered irrelevant by his actions.
Come on, MrCWORM! The “market” (supported by all-too-rare old fashioned journalism) DID decide — the contractor was promptly “forced” to rehire the lifeguard. And it’s a very high confidence conjecture that a Washington D.C. government bureaucracy would have denied and blamed someone else rather than admit it goofed.
AZIZ: I’m an American grandfather frantically doing whatever I can to prevent a bad societal legacy from becoming even worse — much worse than now and incomparably worse than my generation inherited — under the goveernment of Obama and his czars. My less than scholarly take on 19th to 21st century history can find no flaw in your analysis, and your “The fundamental choice we face today is between economic freedom and central economic planning” is spot on, though I suggest “control” (Prof. Hobsbawm’s “Social management”) rather than “planning”.
Economic systems affect much more than goods and services. Marxism enabled Lenin and Stalin to rule with ruthless tyranny. Soviet and Maoist Communism, Hitler’s Nazi (abbreviated German for “Socialist”) party, theocracies, dictatorships, monarchies, etc. are basically the same — government with unlimited power over people with no inalienable rights. Democracy diffuses power among people; free markets do the same!
Government controllers/managers are not professors of economics or anything else. They are ambitious and adept accumulators of power. Monopolists lust for economic power; Hillary Clinton lusts for personal power and wealth; Obama lusts for racial revenge, Muslim supremacy, and imperial power over everything and everybody.
I agree, but I’m not sure Obama lusts for racial revenge or Muslim supremacy. I don’t see his race or his religion as very relevant. Mostly I feel like Obama lusts for the interests of his corporate affiliates, just like most other politicians today.
But Obama is special. He’s driven by his Kenyan father’s hatred of colonialism, Muslim father/step-father/schooling, Pastor Wright’s “God damn (white) America” religion, his wife’s “hatred of anyone not black”, Louis Farrakhan’s anti-white/anti-American Muslim sect, etc. etc. Read his books, college activities, and “open mike” and other slips. While not as recent or visible as Marxist mentoring and associations or as Chicago mob corruption, the practice of racial discrimination and acceptance of domestic and international Jihad is part of him and his administration.
You have been watching too much Fox News, my friend. Your perspective is fear-based. If you think Obama has some special soft spot for the Muslim world, why would he be bombing the shit out of Pakistan?
If he truly favored African and Latino peoples, he would end the war on drugs and capital punishment, which disproportionately affects them.
John, you should really check out this book:
Click to access Markets-Not-Capitalism-2011-Chartier-and-Johnson.pdf
And this site: http://c4ss.org/
Market anarchism is the long-term solution.
Capitalism is too charged of a term to be useful in rational discourse. Furthermore, capitalism is not founded on free markets, it emerged from mercantilism. The state and markets are inextricably linked in historical capitalism. Hence, “Markets not Capitalism.”
Keep up the good work, and be sure to read the book when you get a chance.
I don’t think any -ism is “the solution” to what we have now.
My solution is individuals and communities voluntarily co-operating to reduce reliance on the financial system and the system of globalisation and create self-sufficiency.
You described market anarchism. We cannot get away from “-isms,” they’re ideologies and everything is based on some ideology.
I’m more interested in reality than ideology. I don’t consider myself any kind of anarchist. I prefer a system that protects liberty and economic freedom, but we don’t always get what we want. Certainly not today, anyway. We shall see how the system evolves, and whose projections match reality.
Ideology is theory; you need theory as a coherent framework through which to interpret the data points of “reality.” There is no getting away from theory, human beings evolved to learn through pattern recognition.
Anarchism means “without a ruler.” Do you honestly want the state to exist? Representative decision-making? If you favor a nightwatchman state, you would be a libertarian or minarchist. If you believe that the state will be ever-encroaching, is unnecessary, and merely a means of elite control, then you might consider abolishing it in favor of voluntary association. Murray Rothbard considers himself an anarcho-capitalist, and in “For A New Liberty” outlines a stateless, market-based society.
REPLY to SA23 of Jul 06 @ 04:41:56. I wrote “racial revenge (and) Muslim supremacy”.
Obama does not necessarily “favor African or Latino peoples”. He does not care about ANY people/human beings — individuals or families. He favors any group he can manipulate and use. UNlike MLK, who sought civil rights redress, reconciliation and brotherhood through Christian love and non-violence, Obama and the radical “left” encourage “diversity” (apartheid) in order to generate resentment/suspicion/envy/hatred and desire for revenge against past slavery and discrimination. Their purpose, of course, is power over the people, a unifying goal of Marxists, Muslims, racists, and corrupt political mobs. Additionally, even though Obama has been OVERprivileged, he personally still harbors his father’s hatred of former African colonial powers* and, by extension, “white America”. He supported Pastor Wright’s “God damn white America” church for 20+ years, his Justice Department openly discriminates, he violates states’ rights and other Constitutional law on immigration, etc. etc.
Islam is not a mere “soft spot” in Obama’s character. He was raised as a true believer, and wss further indoctrinated by Farrakhan and others. In the 2008 PRIMARY campaign (before he needed to court loyal Americans’ votes), he didn’t salute the flag, wear a flag pin, or shake hands with Alliance troops before or after photo ops. Then (and after) he radiated solidarity with Muslim powers, promised to close Guantanamo and withdraw from Iraq. As president and Commander in Chief, he supported the Muslim Brotherhood everywhere, announced withdrawal from Afghanistan, suppressed investigations into the Ft. Hood and other Muslim Jihadists in the military, drastically cut the defense appropriations request, and declared that the war on terror was won and over. As to Pakistan, I don’t know where their government stands or will stand, but Obama will continue to PRETEND** to be a warrior until November. [Incidentally, the photo of the White House situation room with Obama and all the top officials waiting for word on the Osama bin Laden raid, was a photo-shop fake].
* Immediately after inauguration, Obama returned the WW II Churchill bust given by the UK.
** As he PRETENDS to believe that Obama care is not a tax and will save federal expense, and that his immigration and other Executive Orders are Constitutional.
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Current system is fascism. That’s true. But true free market economy always finishes as fascism (corporationism). That’s something that you guys don’t see. Let me give you an example:
It is 1998. Nobody heard of web search, right? I don’t think that the term was even defined. So, obviously as nobody knew what it was, there was no Government regulation or intervention in the web search market, right? So, we have 1998 and we have 2 guys in a Garage creating Google. And thanks to the lack of regulation and lack of the Government intervention Google works out beautifully. So far so good. We have 100% pure beautiful capitalism for Google. Everybody happy. Capitalism at its finest. Now comes the part that is explained by Marx and you guys simply don’t grasp: In the year of 2010 Google sponsors a bill to regulate the market economy so its position as a monopoly for web search is secured by the law. That’s the fact bill like this has been developed by Google. Now Google bribes (aka ‘lobbies’) the House/Senate/etc and gets what it wants: if you use Google connections goes through fat and fast Internet connection. If you use something else, no matter how many times better, the law says that slower connections must be used. That’s exactly right. That’s fascism: laws created by corporations to secure their monopolistic positions at the same time empowering Government more as now it needs to eavesdrop only Google’s traffic. Everybody wins. Except for constituency that is. Fascism. In other words once those corporations grow big enough thanks to the lack of regulation and free markets THEY will regulate instead of the Government (democratically elected Government I should add).
And I know what will you say: “Ahh.. it’s still because of the GOvernment because the Government enables this. Because the GOvernment allows bribing and lobbying to happen”.
Well, this argument is aking to communists argumentation that communism would work great if just people could understand that they ought to be equal and not want more than their neighbor. It is the same stupid logic: oh capitalism would work great only if these stupid people would understand not to take bribes, lobby and have no special interests. It is utopia my friends. Politicians will always accept fact checks from corporations. This way corporations ultimately destroy capitalism that created them and replace it with corporationism known also as fascism. That’s the path that not only Google took, but also banks in the past – hence FED was created to secure their interests in 1917. Big Pharma, hence MedicAid and Medicare were created. And military complex hence all the wars.
You see capitalism is self-destructing. So go there and read Marx before dismissing him as an idiot.
Paul Blumenthal,
http://www.sh1ny.com Founder.
I’ve read everything Marx wrote, and most of what Engels and Lenin wrote.
No, no, no. Marxists identify the correct problem: monied incorporations buying out the state. However they fail to identify a correct solution. The answer is not complete absolute statism, so that the state can control the corporate and financial powers. Ultimately, as we saw last century, that just leads to totalitarianism.
The answer is decentralisation. The concentration of power in the hands of the state is the thing that gives birth to the corporations, in terms of limited liability, barriers to entry and their ability to accumulate power. It is also the thing that is so attractive to monied interests, as it allows for the rigging of markets.
This is why I favour decentralised power; the less power in the hands of the state, the less value there is in buying it out. Capitalism, in my view, degenerates into corporatism because industrialists lobby to create large and expansive states that they can use to rig markets and enforce their own power. The answer is to resist the creation of the large expansive state.
No,no,no! Decentralization is anarchism and communism derives from anarchism. In theory communism is all about decentralization. I.e. no money, no government at all! Then in practice they had to centralize to industrialize.
You’re just throwing around -isms.
The Communist Manifesto proposed:
This is not decentralisation at all. This is heavy-handed centralised monopolistic statism created (in the words of Marx) out of violence and bloodshed.
Decentralisation is about not having any of those functions and reducing government to its bare Smithian bones — defence, property rights, the protection of individual liberty and infrastructure. Getting rid of the monopolistic functions of the state, getting rid of the state-enforced barriers to entry, the state-enforced monopoly on currency, the state-enforced limited liability.
And decentralisation can't begin from a central command or revolution. We have to begin by making ourselves independent, creating our own food self-sufficiency, water self-sufficiency, energy self-sufficiency, building local communities and trade networks. With things like solar panels, greenhouses, wind turbines this is becoming easier and easier. That way, we become less dependent on the state, the financial system and the monied corporations built up around it.
State Communism is only derived from Anarchism in the sense that Marx and Bakunin studied under Proudhon, who regarded Marx as having an “authoritarian personality.” Anarchism and Communism during the late 19th century were extremely antagonistic. Allow me to share with you an illustrative quote about anarchism, from the term’s originator:
“The economic idea of capitalism, the politics of government or of authority, and the theological idea of the Church are three identical ideas, linked in various ways. To attack one of them is equivalent to attacking all of them . . .
What capital does to labour, and the State to liberty, the Church does to the spirit. This trinity of absolutism is as baneful in practice as it is in philosophy. The most effective means for oppressing the people would be simultaneously to enslave its body, its will and its reason.”
–Pierre-Joseph Proudhon
I mostly agree with Proudhon about the church and the state, but I think capital can be liberating. Without capital, retirement would be impossible. Capital and labour have no real reason for great antagonism. I think as we move toward a more decentralised society people will realise that they are complementary.
my point is that self-sufficiency is anarchism which is left (Hegel).
And then how all of this changes the basic phenomenon that politicians take bribes from corporations enslaving us in the process?
Using another -ism I think both left and right wing get it wrong because the system we face is neofeudalism. You have masters and serfs. The end to the feudalism comes with the terror of the French Revolution.
I agree we have something approaching neofeudalism.
Thing is, I don’t believe that the French Revolution terror stuff did anything much to end feudalism. I think feudalism was ended by the power and facts-on-the-ground (technology, infrastructure, transport, etc) of the market in creating wealth and creating social and international mobility.
To understand this, we have to look at how feudalism began:
Feudalism in Europe, in my view, had its real origins in the implementation of a large, powerful state with the ability to set prices, a monopoly over currency and the socialisation of industry.
Why politicians take bribes? Because they know they can get away with this. Why bankers/corporations bribe them? Because they know they can get away with this.
Consider this: serfs terrorizing masters with a guillotine, so they don’t think of themselves as a better “race” who can live off of the peasants.
Economy was extremely important part of the process, but don’t underestimate the power of the angry mob and of the historical moment.
Violent revolutions just create more violence, and systemic violence endangers our liberty. This is why I can never really advocate such a thing. I hold to the libertarian principle of non-violence in the tradition of Thoreau, King, De Tocqueville, Lao Tzu, etc.
You said:
“Feudalism in Europe, in my view, had its real origins in the implementation of a large, powerful state with the ability to set prices, a monopoly over currency and the socialisation of industry.”
I think that you put equal sign between socialism and feudalism. You need to distinguish feudalism as a different system from socialism and capitalism. I don’t think there even was idea of the State in the Middle Ages. A knight could be employed by German Prince on one occasion, then French on another and that was normal. There was no idea of pledging to the State. You pledged to your Master. You had the same religion as your master and the same “citizenship”, if you will. State is quite modern phenomenon. Now State couldn’t do anything in middle ages really. Ever heard of decentralizatiion of the European countries in middle ages? Basically each and every European country was divided for centuries. State was extremely weak. That’s especially true for Germany, Italy, Poland, but also Great Britain. Local Princess had more to say than king or emperor at times. And then to say “socialisation of industry” about middle ages… wow! That’s BEFORE words “socialism” and “industry” were even invented!
I am not equating feudalism with socialism. I (and other scholars, e.g. Dennis Gartman) am saying that the middle-age European feudalism emerged out of the collapse of a socialist-imperialist Roman system that originated under Diocletian, and that many of the laws and customs of the socialist system (i.e. tying the peasantry to the land) spilled over into the feudal system that emerged when the Roman empire finally died.
Feudalism came about after the fall of Rome, but it wasn’t because of the Roman system. It grew from the disorder and dominance of the trained warrior. A knight during that time required extensive resources, but once obtained they could once grouped terrorize a large decentralized agrarian state unimpeded unless you too had a collection of highly trained knights to deter such raids. Groups of these knights then banded together to form lordships and kingships and the feudal system was born. Feudalism was a response to the lack of centralized authority to maintain the peace and the current technology at the time. The roman laws helped in developing the Feudal system but it was by no means the cause of it. Peasants didn’t have to stay with their lords, but the outside world wasn’t much kinder.
Actually they did. The Peasant’s Revolt of 1381 happened precisely because peasants were not permitted to leave.
The reality is that the collapsed Roman system tied the people to the land, and so built the foundation of Feudalism.
Yes they couldn’t legally leave. but they could always break the law. But they don’t because the penalties enforced by the ruling warrior class was too punitive to leave The society establishes the law and enforces the laws. Laws do not dictate what the society is. African Americans in the US gained their “freedom” and were technically free, yet still tied to the land through share cropping. After apartheid South Africa, african americans there still live a shit life and many still continue to live in abject poverty. Simply giving the status of free doesn’t mean anyone is necessarily free. Simply having a law that requires people to stay doesn’t define feudalism or is the root cause of feudalism.
Sometimes you blame government for all of the world ills yet in reality you would still advocate some form of central authority to at the very least maintain order. The question is never no government or all government. It is the extent of government and the restrictions on its authority. That is a much more complicated question. You can’t blame Marx just as you can’t blame capitalism. These ideas are merely theoretical. The world doesn’t exist in such plain colors. And dennis gartman? the smug prick on cnbc?
I suppose you can’t blame Marx for Stalin, not directly. I condemn Marx for advocating political violence, and a reign of terror, and for at various points (though not always) advocating economic and political authoritarianism. And you can blame Marxists today for following an ideology that has not ever really created a successful system, or made many successful projections about the future.
Wen will adopt and distort whatever ideology that suits them. For the last few decades in the US, we have been using “free market capitalism” to institute a fascist state. Yet, it doesn’t mean that we blame Adam Smith. Your blame of Marxist is simply scape goating. Men has fought and shed blood since the beginning of time. Dictators have risen and fallen with no relations to Marx. Marx is simply a convenient figure for those in power to either scape goat or idealize. So rather than blame the true failures of the elites and brandish them for the shortcomings, we can jump on to deep seated hatred.
If anyone we should blame Goebbels, Himmler, and the entire fascist regime because that is the true predecessor to our current state. Not Marx. It is Fascism that currently exists in the western world.
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The saying that “This time is different has it” has it’s merit. Indeed people often make the “same mistakes” but more likely not exactly the same and in different ways, less or more, better or worse.
Maxism’s coming back but HE is not the same Maxism as HE was more than a century ago. Everything is changed since then in ways either in appearance or in clothing or both because since the Last Maxism, many new human inventions occurred and many new ideas materialized. People are living differently. In new age, people are looking Maxism under different light in different ways. All in the world that have happened and added up since the late Maxism making Maxism a new age Maxism which becomes more objective and reformed.
p.s Although not all the time people do learn from mistakes otherwise human society won’t be advance to currently level.
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Let’s say I don’t know anything about economics [as many people might contend], that just taking a simplistic view of things as they are, coming to the conclusion that, generally speaking :), “within everything, exists an equal amount of good and bad.”
It appears as if this gathering might agree with that statement [at least on some levels]. Since this basic tenet might apply to all things [even economics], then it should follow that an equal amount of bad will follow the good.
If you examine our present system of economics you will find amazing good and equally amazing bad. After all, who among us refuses to marvel at our smart phone or the latest high tech medical breakthrough? But, look at the costs of shifting so much capital in those areas for the sole purpose of receiving the highest ROI [corruption aside].
In the United States, more than half of the population has essentially none or very limited access to descent health care, yet the technology available to those with access is unparalleled. Side by side with incredible institutions such as MIT, Cal Tech and the like, exist high schools full of students unable to read past a third grade level [if that].
All of these phenomena exist in pairs, always have and always will. The key to developing the best you can hope for [in anything] is in reaching the appropriate balance. In human activity, this seems to take place in very small groups.
Unfortunately, people who are interested in power and wealth understand that the more people, the better the opportunity to accumulate power and wealth. So, perhaps, the debate should not be about what must be obvious to all, that the greatest [responsible] freedom produces the greatest [fill in the blank], but that groups of humans need to be quite small in order to enjoy these freedoms.
Large [fill in the blank] are disasters.
Are you a fan of Nassim Taleb?
His most recent book captures some of the things you are saying.
I am familiar with the name but I am not sure whether I have read any of his work. This POV is fairly common among those who seek simplification.
http://en.wikipedia.org/wiki/Nassim_Nicholas_Taleb
I totally write off Socialists and Communists. I came from a poor family. I went to a Government school that had useless shoddy teachers that taught me less than I learnt from my own home study. I never saw a Union come to myschool to offer well paid jobs . No, they went to their mates. All the socialist students at University came from good families with wealth, and this was their act of REBELLION. How quaint.
I tried to set up a small business in my youth, but Government regulation stopped me. They had to protect the businesses monopolising the sector, so they could pay top wages to the unionised workplace.
When I tried to save money to build my capital I was taxed too much, to pay for the bloated government departments and overpaid bureaucrats.
Abolish regularory capture, abolish market meddling. Jacobians awake from your deluded dream.
Socialists. You are suffocating the hope of the working class to escape from the monotony of the working class. Leave the Missionaries to look after the destitute. Allow people to be homeschooled and pursue their natural interests. We have a cheap school. The internet. Allow tradesment to have apprentices that want to learn. Don’t overregulate so they are scared to teach an awkward and unskilled youth.
The Labour Party in Australia have ruined the country. The only people who benefit are the Union leaders. Parasites.
Excellent Buddy!
Marxism was always and forever a form of neo-Jacobinism. It is a direct extension of the Jacobins, and the French Revolution. It is a creed bathed in blood and violence. When I was younger I used to try and have dialogue with Marxists, and it was always this point that was the stumbling block.
By the way, there is a disturbingly higher proportion of ZH commenters (maybe 25-33%) who seem to have sympathy for Marx. Weird.
These are government workers spying on the disgruntled intelligent citizens who have had enough. They are protecting their gravy train! Their long term pension plan and other job for life benefits.
You can’t open a Zero Hedge account with a GMail or Hotmail account. It takes 4 plus days to open an account. This seems like a Government department.
People now have the ability to run home businesses via the internet. Youtube can teach people how to make machines. 3 D printers will be cheap as paper printers very soon.
The world is rapidly changing. Sooner or later a 3rd world country will open its borders to economic and freedom seeking refugees.
Greece was the canary in the coal mine. All Western Governments have a high level of public spending which is driving out business innovation.
When I see rich socialists spending time to visit impoverished schools to interview the poor but bright children and transform their lives, then I will respect their Jacobean fantasy. Until then it is a front to capture taxes from the people who make an effort to make the world a better place.
Thanks for the internet, and your site. It has certainly crystallised my views about how this world operates. It is unjust, and the poor need to read more and rise up to this suffocating tyranny that is imposed on them. The Welfare they feed the poor to keep them sedate is inadequate anyway, so I am surprised people put up with it.
BTW. In Australia people are being spied on by Government Departments. For instance if they try to sell things on the internet ( A hobby) it is treated like a business and the forego welfare. They can’t get ahead if they tried, and when they try to rise up and trade their way out they are penalised by higher taxes or withheld benefits.
The Socialists BOURGOIS are definitely in control. Wake up PROLETARIAT!
“It has certainly crystallized my views about how this world operates. It is unjust, and the poor need to read more and rise up to this suffocating tyranny that is imposed on them.”
BR, this is called the human condition. It’s never been any different. Instead of attempting to re-engineer human nature, it would seem to be a much better use of time/energy to acknowledge reality and then attempt to adjust human capabilities into this nature.
In other words, assume all the things we already have observed over the millennium. The only purpose for the existence of groups is to steal from other people. Once you get your head around this idea, you can see how human life dis-integrates as groups enlarge [gaining wealth and power] to the point where they cannibalize their own system [as is occurring once again].
You are never going to change basic human nature, as greed, anger and delusion will always carry the day when people rely on their intellect as their guide.
Provided we connect the dots with pragmatic honesty and common sense, don’t we have enough input to focus on the problem(s) and to outline the solution(s)?
er42 blames CORPORATE power and human fallibility (but let’s toss out human “entropy and deterioration” as the cause). You seek DECENTRALIZED power. I wrote that free markets, like democracy, DIFFUSE power.
We all know that Marxism, like all forms of concentrated power (tyranny), spawns human misery. We know that the U.S. Declaration of Independence and Constitution with its Bill of Rights brought two centuries of unprecedented prosperity. Does anyone prefer USSR to USA, East Germany to West Germany, or North Korea to South Korea?
An earlier chain of posts settled on “Liberty vs. Tyranny”.
But we Americans forgot that “All that is required for evil to triumph is for good people to do nothing”! So now we must take back our country from the concentrated power of unconstitutional government conspiring with big* banks, big* businesses, unions, foreign nations, educators, media, ethnic groups, and other special interests trading money and votes for privilege. This is what the grass roots (“tea party”) uprising is all about.
* Destroying the “petite bourgeoisie” was necessary to achieve Communist dictatorship of the masses. [It turned out to be the Party elite who did the dictating].
To repeat — “Free markets, like democracy, DIFFUSE POWER “. I could have further clarified: as per Thomas Jefferson (PEOPLE have inalienable RIGHTS whereas GOVERNMENTS have POWERS), “Bottom-Up” (free-market) works for people and “Top-Down” (state-controlled economy) does not.
“I’m not sure that Marxists have ever understood capitalism”. If capitalists understand capitalism, they certainly don’t advocate for it and indeed they’ve mastered the art and science of exploiting capitalism. True capitalism is really for the 99% but because capitalists were able to churn capitalism into corporatism and oligarchy, we are now stuck with idiots proclaiming that capitalism doesn’t work.
Re: corporations, we have to remember that a corporation is not some independent force of nature– it is created by a government-granted charter, issued under the terms of government-made laws. In its mature form, a corporation is little more than an agency of the state, with few remaining vestiges of a business enterprise.
So whenever I hear some pinhead pundit whining about how we need more “oversight” and “regulation” of corporations, I want to scream. Corporations are a PRODUCT of regulations, do you not realize this? And are you oblivious to the hundreds of thousands of pages of regulations that already exist, and the millions of “civil servants” supposedly dedicated to enforcing them, while all the time corporate abuses continue to multiply and metastasize?
Regulations cannot stop corporate abuses because the concept of corporate law is flawed to its core. As long as you accept the premise that certain groups of people are entitled to limited liability– that is, are essentially above the law in many respects– those groups are going to try to leverage that special status and acquire monopolistic power over both consumers and employees. So they will inevitably find loopholes and exemptions in whatever attempts are made to rein them in.
The only real solution to corporatism is to REPEAL CORPORATION LAWS and return to an economy based on small businesses, with INDIVIDUALS personally responsible for all actions taken. But how many of the supposedly “anti-corporate” types are going to call for this?
Abolishing corporations is a good point. Partnerships can be formed to raise larger amounts of capital, and only reputable partners can be admitted.
As a CPA is sickens me to the core, that a Corporation can go into liquidation and leave creditors penniless. Phoenix companies are a fact, especially when you have toothless tiger regulators.
I agree completely. Corporations are an arm of the state. They derive their power from the state. The bask in the state’s monopoly on violence. They enjoy favourable regulation. They fund the state’s politics. They share and collaborate in power. Sometimes, there is friction, but mostly not.
The corporation is modern church. Within it lies nearly unlimited potential for human good, [therefore its allure] but what comes out of it, is always the same [greed magnified a zillion times].
Unbalanced humans use the power of the group to their own advantage. This will never change until their individual nature changes, something so very rare indeed.
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What is the root cause of the system we have now? The seed that grows into what it is today? Central Banking and fractional reserve. Yes the US did not get the Federal Reserve until very late, and even before that it was not a free market. But it was freeer than it is now. Back then the corporations were in their infancy. Marx and all Marxists completely fail to acknowledge this and many of them actually want to setup a central bank….which would give us more of the same except much worse. Fascism, Communism, Corporate State Capitalism are all similar and all as bad as each other….what we want is less power for the State, less power for corporations and de-centralized economies.
Eh? Why do you think that we marxists believe we have a “free market capitalism”? We marxists understand that a free market can never exist inside capitalism. There are even marxists that want a free market communism, look up mutualism and the teachings of Proudhon, Kropotkin or todays Kevin Carson. Well these guys wont describe themselves as marxist but they agree with him on the basics.
Your post just seems like you dont know anything about the history of the socialist movement and its different schools of thought. We marxists even identify the stalinist systems as state-capitalist as they also were bound by capitals laws and contradictions, the party elite and the big bureaucracy just worked as managers of capital.
The need for marxism today is so that we can understand that capitalism(the existence of capital) cant work anymore, there are too many contradictions built into the system. New marxist studies have shown that it is as Marx predicted the tendency of the rate of profit to fall that produces these big fundamental economic crisis in capitalism. You should read the new book by Andrew Kliman “The failure of capitalist production”.
Your post is just uninformed about marxism and the contemporary thought inside the marxist movement today. Typical for Ron Paul-supporters that have no clue about marxism, you know a bit more but not enough.
We marxists dont blame the market or “freedom” for the errors of capitalism. Capitalism is just a system that produces crisis, that is how capital work. That is why we see the need to abolish capital. Capital is dead labour, the manifestation of the exploitation of the wage labourers. This is where capital is extracted and created.
We abolish wage labour and we abolish capital and instead control the means of production democratically togheter.
Okay — I recognise Marx and particularly Vladimir Lenin among others correctly identified that the freedom of the market might be compromised, and evolve into a kind of state capitalism. On the other hand, they did believe that this kind of unfree evolution was an inevitable outcome of a market economy, and would end with the workers overthrowing capital, which I definitely disagree with.
Correct.
You can’t abolish capital. Capital is a concept, not a system. There will be capital under any system. There is capital in Cuba, and North Korea and the Soviet Union, but it is controlled by — and allocated by — the state. My entire point is that without a market mechanism, this will be a less efficient allocation of capital. This was Hayek’s point in the 30s, and he was proven right by history.
I have studied Marxism very thoroughly. Oskar Lange’s arguments for market socialism are the most advanced school of Marxist thought, in my view, because they try to deal with the Hayekian problem of misallocation of capital that I base my critique of Marxism upon. And still, though the Soviet Union tried to apply Lange’s ideas, it still failed.
Marx and other socialists believe that capital and the state is inherently linked togheter. Capital needs the state to uphold the capitalist property relations. Because capitalism is based on violence, the capitalist accumulation was and still is a very violent process, just look at America when the means of production was taken from the indians with the help of the state.
It has worked like this in every country in the world. As a libertarian would you expropriate all the land that have been taken in such a way that dont correlate with the libertarian view of free markets and trade? This is the fundamentals. This is why Proudhon asked the question in opposition to the contemporary french liberals; “What is property?” and identified that private property of the means of production is theft. Who had the initial right to claim to own so much land that he could not even use it all at the same time as some landless peasants starved? They could only uphold this relation with the means of violence. The state is just a natural continuation of the need to use violence to uphold the unjust property relations.
This is why we marxists want to abolish the state, it is an instrument of the capital to uphold the capitalist property relations and laws. It also worked like this in the stalinist socialist experiments, Lenin and the bolsheviks was really the right wing fraction of the socialist movement in Europe.
Workers or those who have to sell their labour because they dont own the means of production will overthrow capital. Just because capital can never win totally once and forever, it creates and depends on an alien subject(the working class) which constantly threatens its very existence.
We will eventually understand that there are better ways of organising production without the need of exploitation by the capitalists of our own labour.
Of course you can abolish capital, that is what we socialists always strive to do. What is capital as defined by Marx, it is dead labour. All wealth is created by labour, capital is what is left after the workers have gotten their wage and everything else is paid for. This is how capital is produced, basically by the exploitation of the workers, we dont get the full worth of our labour but only a fraction. This can happen just because the capitalists own all the means of production, we have to sell our labour to survive, and we create more wealth than we actually get inside our pockets at the end of the day.
If you abolish this system of wage labour you abolish capital as the dominant force of society.
Production will be organised in a system of mutual agreement and a democratical process in free organisations and cooperatives. The state wont have to exist because everyone owns the means of production togheter, there will be no need for violent repression because all wealth is shared.
Do it. Show me the results. Show me capital and capitalism abolished and humanity organised “in a system of mutual agreement and a democratic process”, and I will see some evidence that my view — that the concepts of capitalism are fundamental — is wrong. Until I see the evidence, I will hold to my current view, as that is what the evidence tells me today.
By the way, Friedrich Engels in Socialism: Utopian and Scientific said that socialists should jump to no utopian conclusions about what is achievable, and that instead they should get on with making their dreams a reality. It didn’t work out very well, though, did it? By all means, so long as you do not come to take my liberty or freedom or property, I have no problem with you trying to create a system that embodies your values. I do have a problem with revolutionary violence, with coercion and with the use of force to impose values on others, though, which is something Marxists have long practised.
@ Erik:
All wealth is created by labour, capital is what is left after the workers have gotten their wage and everything else is paid for. This is how capital is produced, basically by the exploitation of the workers, we dont get the full worth of our labour but only a fraction. This can happen just because the capitalists own all the means of production, we have to sell our labour to survive, and we create more wealth than we actually get inside our pockets at the end of the day.”
This is why you don’t allow an unemployed alcoholic bum (Marx) to be financed by a brat (Engel). The bum has no idea, that you need to put aside the capital (Profit) to smooth out the bumps in demand. The overseer (Capitalist) manages the system to ensure the system has a buffer.
It sounds so lovely in theory. But tell me how do you handle a drop in demand? Lower wages when demand drops? That is the only way supply at a price can match demand with available resources.
In a capitalist system, capital takes a hit. The boss rides out the storm so to speak, and only gets rid of surplus labour to protect his capital if they are not worthy of his benevolence.
Capitalists create jobs, just like the Landlord created an environment for the Serfs, who lead a happy simple life under the organisation of their Landlord.
Watch the movie 1900 http://en.wikipedia.org/wiki/1900_(film)
. It is very good at describing what I am trying to convey.
This is what communism is, to abolish capital as the dominant force of all human relationships.
It will not be a question wether or not we believe that such a system “would work or not”, it has to work. Capitalism constantly produces crisis, the next worse than the last one and every time the means of getting out of the crisis becomes less and less. How does capitalism get out of the crisis? By expanding markets and exploit the existing ones even harder.
How did capitalism recover from the great depression? It could not. What then happend was a monumental destruction of forces of production in WW2. Capitalism could only start working again on the ruins of Europe and Asia. The real choice is really between socialism or barbarism.
Capitalism is just not a sustainable system, this is why we need to organise the economy in a different way. We need to organise the workers so they can themselves produce togheter democratically.
Just as they did in anarchist Spain during the spanish revolution 1935-1939 or in the Ukrainian “Free territory” during the first years of the russian revolution until the red army crushed the black army. Both these examples involved over ten million workers organising the economy democratically togheter moving towards communism.
http://en.wikipedia.org/wiki/Free_Territory
http://en.wikipedia.org/wiki/Spanish_Revolution
Here you have the evidence, I guess they dont teach you this history in the US?
By my definition of capital, abolishing capital as the dominant force of all human relationships is impossible. Capital is just the means of production. Socialising capital does not eliminate capital; it merely puts capital into the hands of bureaucracy, which tends to lead a misallocation of said capital due to the lack of a market mechanism.
Creative destruction is hardly crisis. I suppose the fact that there are 7 billion humans alive today on the back of the innovations of the industrial revolution means nothing to you? The fact that more people than at any point in history have access to food, shelter, healthcare and clean water? The pursuit of capital opens up the doors of innovation, growth and productivity. Yes there are financial crises and systemic failures and corruption, but at least we do not suffer mass starvation due to bureaucratic incompetence as happened many times under planned economies.
Why don’t you focus on organising your own labour, resources and capital instead of worrying about everyone else? I try and live the most honest and productive life I can. Everyone else, I do not and cannot control.
World War 2 was predominantly fought between planned economies. War is misallocation of capital against the desires of the market by the state. A planned economy allows for easier and quicker militarism through the reallocation of resources, labour, capital to the military.
Capital is dead labour, it is extracted by the exploitation of the working class. In a communist society you wont produce any capital as the work you do creates directly and only a use-value.
Of course capitalism have been for the good, it was a necessary step in human evolution evolving from feudalism. But the capitalist propert relations are today holding us back. More and more of the production today are immaterial and the captialist property relations have a very hard time constraining them or valuing them. Just look at the internet for one example and the free flow of information that capital constantly tries to put up walls and restrict.
Imagine if all information was free and shared that today are kept in secret in laboratories because they are owned by private companies with wage labourers not being able to share these ideas and findings with the whole world. Imgaine what steps could be made by a shared science and the free flow of all information.
This is just one of many examples of the capitalist property relations are restricting the productive forces today.
I try to organise the workers to take power over what is rightly ours. I am a worker myself. What I am doing is actually just what you are telling me to do, it is just that I dont own any capital or control any of the means of production.
I hope to do this in the future togheter with everyone else who produces wealth, why should a small elite reap all the benefits of OUR labour?
Your definition of capital, then, is something like surplus value.
I don’t know how you could have an economy that functions only on “use-value”. Value is relative. Your dirt might be my gold, or vice verse. That’s the beauty of a market economy — it allows people with different economic interests and different concepts of value to work together via exchange in a way that is agreeable to all parties.
The internet has done that without any kind of violent revolution or overthrow of the bourgeoisie. It’s an incredible equaliser.
No, that is not my definition. But capital is extracted with the existence of surplus value. My definition of capital is basically dead labour.
Value is not relative, value is basically decided by the amount of social necessary labour time that is put into the creation of the product. The market prices in a totally free market would eventually correlate with the social necessary labour time just because of the competition of the market. It does not work that way in capitalism.
You have a marginalist view of value and i have a marxist view. The marginalist view basically says nothing about the society we live in, it basically just says that value is subjective. This view just produces ignorance.
Yes, the internet cant do violent revolution? The whole point that you dont seem to understand is that the capitalist property relations are starting to put up boundaries and laws inside the internet to restrict the flow of information. It basically means that the productive forces of internet dont correlate with the capitalist property relations, this will cause a huge confrontation.
In the historic process we have always changed economic system when the productive forces have grown to big for the existing property relations. The productive forces have always won in the end. The internet is a manifestation of communism, the majority benefits on the free flow of the internet and shared information, I can download movies, music, books and talk with people for free with people on the other side of the world. We can build programmes togheter with shared information, are you using Firefox right now or Linux? Free source code…. Well, these programmes are a vision from the future communist society 🙂
In Sweden we have today a Pirate Party that got 8% of the votes in the last EU-election, and they are basically anarchists.
AZIZ: I’m surprised that you have the patience to argue with brainwashed ideologues. Remember, “Don’t get in a hissing contest with a goose”.
I think of “Marxism” as socialism enforced by rigged elections, secret police and gulags. Pre- and during-WW II, “democratic socialism” was unsuccessfully marketed by Norman Thomas and the American Socialist Party, NOT to be confused with the Moscow-directed Communist Party USA; as I remember, the Socialist Party platform was less “liberal” than our present government — Dem or Rep, even before Obama and Pelosi.
In 1998 P.J. O’Rourke (in “Eat the Rich”) described the post-WW II government in Sweden made possible by a homogeneous/work-ethic population: capitalist in production/employment, while socialist (almost everything “free” for everybody) in distribution/consumption. However, since then, Sweden has executed a double-reverse. First, people increasingly chose “welfare” over working, plunging government into unsustainable deficits like the EU and USA. Then, three +/- years ago, a new government imposed “austerity”, and today Sweden’s prosperity reportedly rivals Germany’s
Has anybody read Gorbachev’s book (“Glasnost”?)? It features the need for the USSR to adopt “Cost Accounting”, the (in the USSR, counter-) revolutionary idea that costs should be tracked and considered in the production and pricing of consumer goods!
Worth repeating and remembering: a world-traveler friend visited Moscow in the last years of the USSR; his report was, “Everybody has a job. Nobody works. Nobody has any money. If anybody had any money, there is nothing to buy.”
Wow Buddy Rojek, you are actually trying to use the argument that “the capitalists create jobs” by using feudalism as an example “the landlord creates jobs”….
And for the rest of your post? I dont even think you have any idea what you are talking about. You are talking about communism as we will have wages in communism? wtf? Read more, learn more…
When I was younger, I actually experimented with Communist theory (Yes I have read Marx’s works, as well as Spinoza’s. I actually briefly lived in a Commune, and it did not work. People sat around, and waited for the energetic people to do things. It collapsed in argument. Certain individuals had power plays, and people grouped around the leaders to get the benefits. Human nature does not allow Communism. Human greed drives the desire to work and accumulate capital so one does not have to “Toil” If you have the intellect to accumulate capital you earn the right to command the Sheeple. The Sheeple are usually thankful you can “Baby” them.
Don Grier: I am from Sweden and what you are talking about is bs. Sweden never had huge deficits, they were created by the banks and financial institutions when they collapsed in 1991 and the state had to step in and save them. The crisis happend because Sweden deregulated the credit markets in 1985, also called the novemberrevolution. We went from an unemployment of 1-2 procent til an unemployment between 6-12 percent ever since the crisis.
What caused the crisis and the deregulation to begin with was the very low rate of profits. It was a schoolar example of Marxs “the tendency of the rate of profit to fall”. Capital need the crisis to restore the profit levels.
Today Swedens population and business have even more loans than before the crisis in 1991. The property assets bubble are just about ready to burst and then Sweden will look like and eastern european development country again.
This is why marxism and anarchism is becoming huge in Sweden just because socialdemocracy have failed and neoliberalism have failed. Why would we Swedes want capitalism if we cant have our welfare state? This was the historical compromise in Sweden when the working class became to organised and militant, the capitalist went scared and agreed on all the benefits of the welfare state for the workers.
It was when the socialdemocratic ruling party and the unions(organising 95% of the workers) started to introduce “wage-founds” that the capitalists went on the counter offensive. The wage-founds would buy all the means of production and in some years all the means of production would be owned democratically togheter by the workers themselves, communism in practice without any revolutions. This could not happen and thats why the crisis was produced by the help of the IMF.
Aziz: So you r writing about marxism, but it seems you don’t even know marx’ definition of capital! Cuba, North Korea or SU (by the way, it doesnt exist anymore) aren’t/weren’t communist “states”, they were/are “socialist” states! by the way, marx himself said about marxism in his time: “if this is marxism, i am not a marxist”
greetz from germany 🙂
Capital is simply the means of production. Marx’s definition was too rigid. Labour is a form of capital, financial instruments are a form of capital.
I don’t really care how people define the historical examples of socialist/communist/Marxist/state capitalist/Maoist societies. The fact is that the leaders claimed an allegiance to Marx. As far as I can tell, the Soviet Union was relatively (though not entirely) consistent with Marx’s program presented in the Communist Manifesto:
Those Marxists who want to claim that historical Marxist or Marxist-influenced states are “not Marxist” because they did not follow Marx 100% remind me of Islamists who say that the problems in the Muslim world are a product of not following the Qu’ran 100%. Ideology is a poor substitute for success.
But marxism is not “the communist manifesto” as you have quoted here. It was written back in the mist of the 1848 european revolutions. Before he wrote Das Capital and before the teachings of the Paris commune 1871 that deeply effected and changed Marxs views on the state.
The question of the state have always been the big divider of the socialist movement. Can we use it for transition? The more libertarian socialists such as Proudhon, Bakunin, Tolstoy, Luxemburg, Kropotkin always was against this view of using the state and constantly critiqued Lenin and the gang.
Todays marxism have more than ever a more anarchist-string attached to it as it started to develop in the Italy in the 70s by the operaist movement with the main theorist Antonio Negri.
This school is called autonomist-marxism and is perhaps the most influential today. You can read “Empire” by Antonio Negri and Michael Hardt to learn more or check out Tiqquns writings. This school has a more libertarian view;
“Being a communist means being against the state” – Antonio Negri
Erik, “sympathy for the oppressed,” is a questionable starting point in attempting to right the ship of social humanity. Material wealth being relative, you will always have disparity.
As long as you create methods to successfully abstract the methods by which the few control the many, e.g., property, money, law, etc., the same exploitative paradigm will continue to define human social behavior.
The way out of this Hell is not in attempting to impose ideals, laws, -isms, or any other thought system. Otherwise, it seems likely that somebody would have figured this thing out thousands of years ago.
impernance: “Sympathy for the oppressed”? What in earth are you talking about? I dont have any sympathy for anyone, I do have solidarity with my fellow workers tho…
Communism is about controlling the means of production democratically togheter. The few are unable to control the many, that is the whole point.
“Communism is about controlling the means of production democratically together. The few are unable to control the many, that is the whole point.”
Erik, the few have ALWAYS controlled the many, that’s reality.
communism is is pure hopium. 5000 years of human social history seems to suggest that our species is what it is, like the rest of the primates on the planet [except we think we understand].
IMP.: This (Jul 06 @ 19:51:44) brief comment hits three nails on the head, ‘though I wouldn’t describe the world in which most of us live “Hell”. Well, maybe compared to potential, but NOT compared to past centuries and to still-uncivilized areas of Africa, middle-east, and elsewhere.
Attaboys also to Buddy Rojek for his Jul 05, 23:1:43 post, pointing out that Australia, a country that appears to be better than most, has room for improvement.
CORRECTION: referenced Buddy Rojeck post was Jul 05 @ 23:31:47.
Pingback: Is Marxism Coming Back? - ALIPAC
The issue is not the market, the issue is the kind of society in which the market functions and that has to do with legalities, who has the power to distribute the rewards from successful performance in the market. Distribution of rewards under director capitalism goes to the directors. They set their own salaries and thumb their noses at us. But when Volkswagen makes a huge profit from performance in the marketplace, its employees get a big reward. Volkswagen exists under a regime of co-determination.
How does this (big reward/co-determination) work at Volkswagen? Like U.S. “profit-sharing” contracts with employees?
With the support of our congress & president then yes, Marxism is making a return to the world scene.
AZIZ and everyone:
While the internet is indeed a glorious* forum for discussion and debate, it doesn’t impose useful disciplines such as the hard sciences procedure of submission and peer review of “papers”. With hind sight of this fascinating and meandering chain of “Is Marxism Coming Back”, I wish there had been an introductory definition of terms and perhaps an “abstract”.
However, better late than never. Can “we” arrive at consensus on terms such as Marxism, communism, socialism, fascism, corporatism, anarchy, mercantilism, imperialism, capitalism, capital, labor, profit, free market, democratic, feudalism, monopoly, competition, etc., along with hyphenated
It would also help if you scholars would relate the ism’s by time and geography.
* AZIZ and Buddy — note Brit/Aussie term!
Oops …
…(hyphenated) offshoots and derivatives.
Belated clarification: when I wrote “arrive at a consensus on terms”, I meant the DEFINITION of each term, not the merits/demerits.
Lets compare Germany with current US and see what Fascisms is all about.
1) Powerful and continuing nationalism
2) Disregard of Human Rights in response to fears of security and the “enemy”
3) Scapegoats as a unifying cause
4) Supremacy of the Military
5) Controlled mass media
6) Obsession with National Security
7) Religion and government intertwined
8) Corporate power protected above all else
9) Labor power suppressed (yes unions besides those large protected unions are impossible to form due to current laws. So if you are big enough to contribute money you are protected. For the other working stiffs no.)
10) Obsession with Crime and Punishment
11) Rampant cronyism and corruption
12) Rigged Elections – gerrymandering is rigging. Voting rules and regulations rig the elections to a 2 party system with no choice.
So there you have it. Facism governance by the major corporations and entities by fear, hatred, national pride, and the military through the means of a controlled media and religion.
Sounds like Australia.
Rojek: if you really thought that Australia is like Nazi Germany, you would not be rejoicing that you were not conquered by Japan.
blah X 3: I hope Aziz, from the UK, will find the patience to thoroughly refute your (mostly) nonsense. I will just correct your exam paper, so you will know your grade. [I assume you mean NAZI Germany].
#4, #7 & #9 — completely wrong, 0 or negative correlation.
# 11 & #12 — significant positive correlation, but < .2 or so.
All others — trivial positive correlation, although big BANKS are protected.
Hahaha, mostly nonsense. I fail you buddy.
John, your article cracked over 100 comments. Well done.
“How can we meaningfully call a system where the price of money is controlled by the state a free market?…”
We can’t call any system a free market because no such thing exists! Marx himself made this *exact* point:
“Economists have a singular method of procedure. There are only two kinds of institutions for them, artificial and natural. The institutions of feudalism are artificial institutions, those of the bourgeoisie are natural institutions. In this they resemble the theologians, who likewise establish two kinds of religion. Every religion which is not theirs is an invention of men, while their own is an emanation from God. When the economists say that present-day relations – the relations of bourgeois production – are natural, they imply that these are the relations in which wealth is created and productive forces developed in conformity with the laws of nature. These relations therefore are themselves natural laws independent of the influence of time. They are eternal laws which must always govern society. Thus, there has been history, but there is no longer any. There has been history, since there were the institutions of feudalism, and in these institutions of feudalism we find quite different relations of production from those of bourgeois society, which the economists try to pass off as natural, and as such, eternal.” — K. Marx, The Poverty of Philosophy
See also Ha-Joon Chang on the lack of existence of a ‘free market.’ Limited liability laws are a fantastic example of an ‘intervention’ ignored by many free market advocates.
“And the future that Marx predicted never came to fruit; his 19th Century ideas turned into a 20th Century reality of mass starvation, failed central planning experiments, and millions of deaths.”
You are aware that any semi successful attempt at socialism was simply overthrown by the United States? Allende was democratically elected (no matter what supporters of Pinochet say) and the US staged a coup. The United Fruit Company had the US bomb the Guatemalan capital and force their democratically elected socialist president into exile, all because he told them to stuff it when they asked for extortionate terms of contract. Indonesia had a fairly successful communist government for a while until that too was overthrown.
There are then countless examples of any peacefully elected socialist/communist state being strangled at birth by the US, the most notable being Italy straight after world war two, which involved a lot of propaganda and funding by the CIA, which also worked closely with the Sicilian Mafia at the time.
This isn’t some sort of conspiracy theory. It’s all well documented: http://killinghope.org/
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