The Communist Manifesto Hits 160
This year marks the 160th anniversary of the Communist Manifesto and capitalism, aka "free enterprise," seems willing to observe the occasion by dropping dead. On Monday night, some pundits were warning that the ATMs might run dry and hinting that the only safe investment left is canned beans. Apocalypse or extortion? No one seems to know, though the populist part of the populace has been leaning toward the latter. An email whipping around the web this morning has the subject line "Sign on Wall St. yesterday," and shows a hand-lettered cardboard sign saying, "JUMP! You Fuckers!"
The Manifesto makes for quaint reading today. All that talk about "production," for example: Did they actually make things in those days? Did the proletariat really slave away in factories instead of call centers? But on one point Marx and Engels proved right: Within capitalist societies, or at least the kind of wildly unregulated capitalism America has had, the rich got richer, the workers got poorer, and the erstwhile middle class has been sliding toward ruin. The last two outcomes are what Marx called "immiseration," which, in translation, is the process you're undergoing when you have cancer and no health insurance or a mortgage payment due and no paycheck coming in.
Marx predicted that capitalism would fall in a spirited, pro-active, fashion: The workers, fed up with immiseration, would revolt, seize the "means of production," and insist on running the show themselves, that being the original, pre-Soviet, notion of socialism. The revolution didn't happen, of course, at least not here. For the last several years, American workers have sweetly acquiesced to declining wages, rising prices, speed-ups at work, disappearing pensions, and increasingly threadbare health insurance. While CEO pay escalated to the 8-figure range and above, so-called ordinary Americans took on second jobs and crowded into multi-generational households with uncomfortably long waits for the bathroom.
But all this immiseration - combined with fabulous enrichment at the top - did end up destabilizing the capitalist system, if only because , in the last few years, America's substitute for decent wages has been easy credit. Until about a year ago, we got almost daily messages, by telemarketer and by mail, urging us to consolidate our debts, refinance our homes, transfer our debts from credit card to another, and try tasty new mortgages that didn't even require a down payment. All too often, we bit. It sounded so reasonable, for example, not to let our assets just "sit" in our houses but to start spending that money now.
At the other, Lear jet, end of the economic spectrum, there was the problem of what to do with too much money. Yes, this can be a problem. Some of the super-rich have to hire consultants to help them spend their money: Where do you get a $20,000 bottle of wine or find a Picasso for the bathroom wall? More seriously, there was the problem of what to invest in. As Chuck Collins of the Working Group on Extreme Inequality has pointed out, huge concentrations of wealth can function like rogue waves, smashing around recklessly in their search for ever higher returns. A lot of these money waves flowed, directly or indirectly, into the dodgy credit schemes that were engulfing the un-rich majority, leaving even the fat cats imperiled by the toxic debts of the subprime class.
Marx's argument was that the coexistence of great wealth for the few and growing poverty for the many is not only morally objectionable, it's also inherently unstable. He may have been wrong about the reasons for the instability, but no one can any longer deny it's there. When the greed of the rich collided with the needs of the poor - for a home, for example - the result was a global credit meltdown.
Obviously, the way to address the crisis is to deal with the poverty and inequality that led to it: bail out people facing foreclosures, increase food stamp allotments, extent unemployment insurance, and, make a massive job-generating, public investment in infrastructure, and, since medical debts are the number one cause of personal bankruptcy, enact universal health insurance immediately. But not even Obama, whose lawn sign I still proudly display, seems to have the stomach for such a "trickle upwards" approach. He has announced that he won't bother taking the bail-out as an opportunity to change the bankruptcy law so that people facing foreclosure can renegotiate their mortgages.
So happy birthday, Communist Manifesto - although I'm hoping that capitalism survives this one, if only because there's no alternative ready at hand. At the very least, we should get some regulation and serious oversight out of any bail-out deal, meaning that, yes, the economy will look a little less like "free enterprise." But one thing we should have learned in the last week, if not the last year, is that, when applied to enterprise, "freedom" can be just another word for someone else's pain.
Loading comments…
Want to reply to a comment? Hint: Click "Reply" at the bottom of the comment; after being approved your comment will appear directly underneath the comment you replied to
The connection between the fall of communism in week 44 of 1989 and the fall of its opposite extreme, capitalism, as we approach week 44 of 2008 is most revealing. But that doesn't mean something much better cannot emerge from all this. Who knows? Perhaps true creativity, or even compassion, will make a comeback! Week 44 (this leap year running from October 28 to November 3, and running up to the election for the 44th president of the United States), seems to be a crucial window of time.
http://cre
What tore apart Russia was keeping up with the military threat of the US. What tore part the US was itself.
Don't count old Karl out. He was absolutely correct about "free-trade" which has set this country on an economic down turn since 1973 when Nixon fully embraced it (cp., Dr. Ravi Batra). In 1848 Karl Marx said:
"the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone. . . . that I vote in favor of free trade."
Remember that giant "sucking sound" that Ross Perot mentioned back in 1992? otherwise called "labor arbitraging", well it is still going on. We are becoming a nation of hamburger flippers as our factories are being packed up and shipped off to China and elsewhere.
Republicans might like to disabuse themselves of the notion of the Free Market. My reading of American history shows that subsidies (that is, government intervention) have always played a prominent role, from the railroads through telecommunications through electrification through energy through industrialization. In any case, at this point, serfdom is starting to look pretty good. At least the overlord was required to give you a new set of clothes every year.
Our society is caught in a truly Marxian contradiction. the executives have gotten really good at keeping that surplus value in their own pockets, but with a consumer society this means the proles don't have the money to buy their products. Giving everyone who breathes a credit card doesn't work, because if they don't have the money to buy the products now, then they won't be able to pay back the money with interest unless their income increases in the interim.
Looks like the capitalists have outsmarted themselves. They should have listened to that arch capitalist Henry Ford when he said,"I pay my workers well so they can afford to buy my cars"! That idea worked from the 1940's to the 1980's to bad they didn't keep it up.
Now all the wannabe John Galt's and Dagny Taggarts are now lining up at the Galt's Gulch food stamp office. When the going gets tough, the tough turn socialist.
We could use a henry ford right about now. The closest we have is Buffett.
"The Manifesto makes for quaint reading today."
The Communist Manifesto is as applicable today as it was 160 years ago - and possibly even more so. Do not dismiss this powerful political statement as yesterday's news.
Capitalism is a FAILED ECONOMIC SYSTEM. The latest crash on Wall Street shows that capitalism MUST HAVE regulations and rules if it is to survive.
The United States, like most other industrialized nations, will inevitably move towards socialism. The only thing that prevented a full-scale socialist revolution in this country following the Republican Great Depression of 1929 was the intercession by FDR. Had FDR not stepped up to the plate, adopted some socialist solutions, the United States as we know it today would not exist. A socialist republic would have been created - not in the image of Stalin's USSR, but more in line with our European allies. Had we continued down the path that FDR began, perhaps our economy would not be so susceptible to the failings and greed of a few, very rich men.
yeah just look at all those flourishing communist countries, cuba.....u
What about CHINA? Or are you one of these nutjobs that somehow equates free markets with democracy? We don't have democracy here in the US, and they sure as hell don't have it in China, which happens to be COMMUNIST.
China? They seem to be doing pretty good. We (the capitalists) owe them TRILLIONS of dollars. The former U.S.S.R just used their economic leverage over Europe to keep them on the sidelines while they openly bullied their former republic Georgia, and Cuba seems to be doing just fine.
You forgot China. They're the ones that we've been slowly selling all our assets to. Seems like it's working out pretty well there.
The idea that somehow failed 'communist' (and the word applies only loosely to some of those countries you mentioned) are proof that communism is a flawed concept is absolutely ridiculous. Mostly they only serve as proof that a communist dictatorship is a flawed concept.
I'm still waiting to see a communist democracy in action.
China is driving the current crisis. They want to sell back the junk the liars on Wall Street sold them as AAA.
Marx's communism looked great on paper. Republican's deregulated capitalism works great on paper. Both fail to include the human factor which is that we're a bunch of greedy, corrupt bastards when given the chance. We'll take all the money or all the power and step on everyone else unless we're in check.
I think capitalism has proven it can work far better than communism as long as it is regulated.
Your last statement is correct. However, it was never a competition between capitalism and communism. If you are a student of the subject, there is the dialectic which is: capitalism to socialism to communism. It was Lenin (who was a member of the communist party) who forced the "spark" to force socialism into a premature birth. It was supposed to happen when all the workers were so so pissed that they took the heads off the capitalists moving into the stage of socialism. (as it was the Bolsheviks forced it in WWI Russia) And from the social state of socialism the next phase in the dialectic would be communism (which by the way... entails the "withering away of the state") and this would be a state something like we live in our own homes, our families. However... the skeptic in us denies that this state would ever really be reached. So... my point is that Communism was never meant to be in competition vis-a-vis Capitalism. We refer to the USSR as communists because they were members of the Communist Party. They never were communist in the sense of the being of communist. It is kind of like the Cleveland Indians... there are no Indians on the team.
Great post, Henry.
Marx made a very profound statement which should be the guiding principle to guide America out of the present crisis. it goes like this: " How men organize to produce the means of their subsistence, constitutes the fundamental relations of society." The people need to take back the country from the few who hijacked it in the name of greed and profit.
At least in the 1930s we had a Rooseveldt to elect and to believe in.
The bigger crisis, as far as social stability is concerned, is that the people no longer believe that the Congress represents the people but rather that the Congress represents the monied campaign contributors of Wall St. Why is no one is talking about bailing out the mortgage holders - just the firms holding bad mortgage paper?
Obama has taken major contributions from Fannie Mae (or was it Freddy Mac?) and McCain has Phil Graham and other assorted Republican fat cats advising him. Paulson once ran a big Wall St. firm, for cryin out loud.
And now we are being told that this is too important and too pressing to be addressed by the political process in the coming election - that a bail out is needed RIGHT NOW!
Combine that with the decline in the American standard of living over the last 20 years and you might just have social dynamite of a kind not seen since the 60s.
I have observed over my life that this "word" capital gets butchered all over the place. You have capital goods. You have the flow of capital. And George Jr has "political" capital. Marx wrote Das Kapital in which he describes the ogre, the capitalist, who accumulates all the value in production in excess of remuneration to labor as the spoils in the labor theory of value. He contends that the worker produces it all, but gets only wages. The excess is accumulated as capital and it inures to the benefit of the capitalist, the landlord, the pecuniary class.
I listened to a senator this morning talk about the flow of capital and I wondered if he knew that he should have been using the word "cash".
When we talk about the all important "capital ratio" we use the word capital to to mean net worth. This is the exprssion that most nearly approximates that meant by Marx. The net worth of a corporation is the sum total of all accumulated excess plus initial capitalization in the form of stock.
Marxism is broken because it treats capital (tools and inventory, and the money that represents them) as if it were a natural resource, and fails to reward people for taking risks. Monopolistic capitalism, the kind we have now, is broken because it treats natural resources as if they were capital, and rewards people for stealing the public domain.
What we need is a system that funds social services out of taxes on natural resources (including the unimproved value of land and the full value of franchises like spectrum), and gives its full reward to both true risk-taking capitalists and laborers.
Well done, as usual. I would add that in light of political spinelessness on a scale perhaps unprecedented in US history coupled with financial inequality perhaps also without equal--it might be time to seriously consider (among other more physical tactics) a long look at the two (one) party system.
I know the author is aware of the media hegemony regarding who gets air time and who doesn't.
Of course, it's a case of too little too late. And I ask myself, Ron Paul-didn't he get more money from the actual people vs. corporate money than anyone else? Didn't he clearly work through the system from the ground up while both the major candidates received the vast sum of their donations from parties with obvious corporate/corrupt interests?
Your solutions are absolutely reasonable and if you were on the ballot I'd vote for you.
You must be logged in to comment. Log in or connect with
