Thursday, 4 October 2012

Review: Masters of Money on Marx

Let the ruling classes tremble in the face of a communist revolution. The proletariat has nothing to lose but its chains. They have a world to win. Proletarians of all countries, Unite!
And with that Karl Heinrich Marx signed off the Communist Manifesto and sent it to the printers. It was a radical, nay politically explosive, leaflet that provided much of the inspiration for the communist states of the twentieth century. Needless to say, it didn’t work as intended. The proletariat was not made free, and it did not prosper. But if the fall of the Berlin Wall consigned Marx and his writings to the ‘ash heap of history,’ capitalism’s current sorry pass may turn them into a phoenix. Maybe people will start contemplating once more the revolutionary method.  Well, the man is back being discussed on prime time television, anyway.       
Masters of Money, the three part series on macro-economists, finished this week by applying Marx (widely recognized as the economist with the best facial hair) to the modern world. If you can look past all the communism stuff, explained the presenter Stephanie Flanders, you may find that Marx does offer a decent analysis of capitalism’s current crisis.
Capitalism has much to its credit. Marx recognised this. But he believed also that capitalism was just a phase of human progress, and that it contains within it the seeds that would one day lead to its ultimate destruction. Pehaps we are seeing this come to pass.
 The programme explained how, by means of several helpful illustrations involving wooden logs and lego men.
The fact of private property divides the worlds in to ‘Haves’ and ‘Have-nots.’ The ‘have-nots’ find that, as they don’t have anything, they must work to take wages from the ‘haves’.  They are the workers. Their bourgeois bosses, the ‘haves,’ will sell the fruits of their labour on for a greater price than they paid for them. Capitalism is, after all, driven by the profit motive. Bosses will shrink wages as much as possible in order to enlarge profit margins. This will widen the gap between rich and poor (or perhaps, in the phrase of a certain ragtag bunch of campers, the 1% and the 99%). It will also diminish the spending power of the average worker.  Money will stop circulating, and that spells crisis. Or, if capitalism is clever, it invents the credit card and sub-prime debt, and reschedules the crisis for a later date. 
The drive for profit destroys the means of its production. So capitalism is doomed.  It is a historical inevitability.
Is he right in his analysis? Perhaps in part. The last 30 years or so, - the trade union actions of the 1970s, the monetarism of the 1980s - could be viewed as a struggle between boss and worker. The wide pay gap between rich and poor can be ascribed to the aggressive pursuit of profit, and the vast industrial reserve armies of central Asia deflating the value of the worker’s labour.  And reckless borrowing can indeed be caused by a lack of funds. 
But capitalism is still with us, even after all the crises. And the workers of the world are not paying much attention to Marx’s call. But let us suppose that Marx was indeed spot on. Capitalism is doomed to destruction by its internal contradictions. Let us further suppose, just for fun, that the one solution is indeed revolution. Capitalism was only ever going to be a phase, anyway.  Now we must replace it with something new. What shall that be?