marx and utopia -- 2/21/23
Today's selection -- from Slouching Towards Utopia by J. Bradford DeLong. Karl Marx argued that market economies necessarily produce ever-rising inequality and ever-increasing immiseration in the company of ever-increasing wealth. Was he right or wrong?
"Until it really existed, 'socialism' could mean many things -- things other than the system Lenin created and Stalin solidified. In Western Europe and North America during the World War I era, most who called themselves any flavor of 'socialist' held that in a good society there ought to be enormous scope for individual initiative, for diversity, for the decentralization of decisionmaking, for liberal values, and even for non-commanding-heights private property. True freedom was, after all, the point. Eliminating the unequal distribution of income under capitalism that kept the bulk of the formally free imprisoned in the same life of drudgery was the goal.
"In price regulation and in public ownership, the question was an empirical one: private where private belongs, public where it was needed. And most people trusted representative democracy and rational argument to settle things case by case. But others took a more radical view, pushing for something beyond even a reformed, well-managed, and gentler market economy. It wasn't until Lenin began to exercise power that people began to discover the tradeoffs that would be involved in a really-existing socialism focused on destroying the power of the market.
"Lenin, his followers, and his successors began with a general article of faith: Karl Marx was right. In everything. If properly interpreted.
"Marx had mocked the sober businessmen of his time. They claimed to view revolution with horror. Yet, Marx asserted, they were themselves, in a sense, the most ruthless revolutionaries the world had ever seen. The business class -- what Marx called the bourgeoisie -- was responsible for the (up to then) greatest of all revolutions, and that revolution had changed the human condition. For the better. After all, it was the business class of entrepreneurs and investors, together with the market economy that pitted them against one another, that was responsible for bringing an end to the scarcity, want, and oppression that had been human destiny theretofore.
"But Marx also saw an inescapable danger: the economic system that the bourgeoisie had created would inevitably become the main obstacle to human happiness. It could, Marx thought, create wealth, but it could not distribute wealth evenly. Alongside prosperity would inevitably come increasing disparities of wealth. The rich would become richer. The poor would become poorer, and they would be kept in a poverty made all the more unbearable for being needless. The only solution was to utterly destroy the power of the market system to boss people around.
"My use of 'inescapable' and 'inevitable' is not for dramatic effect. Inevitability was for Marx and the inheritors of his ideas the fix to a fatal flaw. Marx spent his entire life trying to make his argument simple, comprehensible, and watertight. He failed. He failed because he was wrong. It is simply not the case that market economies necessarily produce ever-rising inequality and ever-increasing immiseration in the company of ever-increasing wealth. Sometimes they do. Sometimes they do not. And whether they do or do not is within the control of the government, which has sufficiently powerful tools to narrow and widen the income and wealth distribution to fit its purposes.
"But utopian, and for that matter dystopian, thinking does poorly with sometimes this and sometimes that, better or worse outcomes dependent on governments and their decisions. Inevitable was the patch for the flaw of contingent uncertainty. So Marx decided to prove that the existing system guaranteed dystopia: 'The more productive capital grows, the more the division of labor and the application of machinery expands. The more the division of labor and the application of machinery expands, the more competition among the workers expands and the more their wages contract. The forest of uplifted arms demanding work becomes thicker and thicker, while the arms themselves become thinner and thinner.' Marx was also certain that his dystopian vision of late capitalism would not be the end state of human history. For this bleak capitalist system was to be overthrown by one that nationalized and socialized the means of production. The rule of the business class, after creating a truly prosperous society, would 'produce … above all … its own gravediggers.'
"What would society be like after the revolution? Instead of private property, there would be 'individual property based on ... cooperation and the possession in common of the land and of the means of production.' And this would happen easily, for socialist revolution would simply require 'the expropriation of a few usurpers by the mass of the people,' who would then democratically decide upon a common plan for 'extension of factories and instruments of production owned by the State; the bringing into cultivation of waste-lands, and the improvement of the soil generally.' Voila, utopia.
"Except, of course, Marx was wrong.
"This inequality-increasing immiserarion-inevitable socialist revolution simply did not happen. For one thing, immiseration did not happen, in Britain at least, beyond 1850. Inequality had increased up to a peak of 1914 in Western Europe and 1929 in North America. But the upward leap in economic growth after 1870 meant that working classes all over the globe were also becoming richer and richer than their predecessors.
"That Marx got it wrong is not surprising. The fact is he was a theorist with only one example of industrialization to draw on, Britain. And in Britain, large and visible sections of the working class were worse off in 1840 than in 1790. Technological unemployment was a powerful thing. The construction of dark satanic mills in Lancashire left rural weaving skills useless and populations impoverished. There was a window of time when some of, even much of, Marx's dark brooding seemed plausible. In 1848 the belief that market capitalism necessarily produced a distribution of income that was unbearable was not reasonable. By 1883, when Marx died, such a belief was indefensible. By 1914, the doctrine of inevitable immiseration was indeed a doctrine: a matter not of human reason but of pure transcendent faith alone."