This short biography is based on Frederick Engels’ version written at the end of July 1868 for the German literary newspaper Die Gartenlaube, whose editors decided against using it.

  Written: Engels rewrote it around July 28, 1869;
  First Published: in Die Zukunft, No. 185, August 11, 1869;
  Translated: by Joan and Trevor Walmsley;
  Transcribed: for the Internet by Zodiac;
  Html Markup: by Brian Baggins.

Many thanks to Marxist Internet Archive   http://www.marxists.org

Karl Marx was born on May 5, 1818 in Trier, where he received a classical education. He studied jurisprudence at Bonn and later in Berlin, where, however, his preoccupation with philosophy soon turned him away from law. In 1841, after spending five years in the “metropolis of intellectuals,” he returned to Bonn intending to habilitate. At that time the first “New Era” was in vogue in Prussia. Frederick William IV had declared his love of a loyal opposition, and attempts were being made in various quarters to organise one. Thus the Rheinische Zeitung was founded at Cologne; with unprecedented daring Marx used it to criticise the deliberations of the Rhine Province Assembly, in articles which attracted great attention.

At the end of 1842 he took over the editorship himself and was such a thorn in the side of the censors that they did him the honour of sending a censor [Wilhelm Saint-Paul] from Berlin especially to take care of the Rheinische Zeitung. When this proved of no avail either the paper was made to undergo dual censorship, since, in addition to the usual procedure, every issue was subjected to a second stage of censorship by the office of Cologne’s Regierungspresident [Karl Heinrich von Gerlach]. But nor was this measure of any avail against the “obdurate malevolence” of the Rheinische Zeitung, and at the beginning of 1843 the ministry issued a decree declaring that the Rheinische Zeitung must cease publication at the end of the first quarter. Marx immediately resigned as the shareholders wanted to attempt a settlement, but this also came to nothing and the newspaper ceased publication.

His criticism of the deliberations of the Rhine Province Assembly compelled Marx to study questions of material interest. In pursuing that he found himself confronted with points of view which neither jurisprudence nor philosophy had taken account of. Proceeding from the Hegelian philosophy of law, Marx came to the conclusion that it was not the state, which Hegel had described as the “top of the edifice,” but “civil society,” which Hegel had regarded with disdain, that was the sphere in which a key to the understanding of the process of the historical development of mankind should be looked for. However, the science of civil society is political economy, and this science could not be studied in Germany, it could only be studied thoroughly in England or France.

Therefore, in the summer of 1843, after marrying the daughter of Privy Councillor von Westphalen in Trier (sister of the von Westphalen who later became Prussian Minister of the Interior) Marx moved to Paris, where he devoted himself primarily to studying political economy and the history of the great French Revolution. At the same time he collaborated with Ruge in publishing the Deutsch-Französische Jahrbücher, of which, however only one issue was to appear. Expelled from France by Guizot in 1845, he went to Brussels and stayed there, pursuing the same studies, until the outbreak of the February revolution.

Just how little he agreed with the commonly accepted version of socialism there even in its most erudite-sounding form, was shown in his critique of Proudhon’s major work Philosophie de la misère, which appeared in 1847 in Brussels and Paris under the title of The Poverty of Philosophy. In that work can already be found many essential points of the theory which he has now presented in full detail. The Manifesto of the Communist Party, London, 1848, written before the February revolution and adopted by a workers’ congress in London, is also substantially his work.

Expelled once again, this time by the Belgian government under the influence of the panic caused by the February revolution, Marx returned to Paris at the invitation of the French provisional government. The tidal wave of the revolution pushed all scientific pursuits into the background; what mattered now was to become involved in the movement.

After having worked during those first turbulent days against the absurd notions of the agitators, who wanted to organise German workers from France as volunteers to fight for a republic in Germany, Marx went to Cologne with his friends and founded there the Neue Rheinische Zeitung, which appeared until June 1849 and which people on the Rhine still remember well today. The freedom of the press of 1848 was probably nowhere so successfully exploited as it was at that time, in the midst of a Prussian fortress, by that newspaper.

After the government had tried in vain to silence the newspaper by persecuting it through the courts – Marx was twice brought before the assizes for an offence against the press laws and for inciting people to refuse to pay their taxes, and was acquitted on both occasions – it had to close at the time of the May revolts of 1849 when Marx was expelled on the pretext that he was no longer a Prussian subject, similar pretexts being used to expel the other editors. Marx had therefore to return to Paris, from where he was once again expelled and from where, in the summer of 1849, [about August 26 1849] he went to his present domicile in London.

In London at that time was assembled the entire fine fleur [flower] of the refugees from all the nations of the continent. Revolutionary committees of every kind were formed, combinations, provisional governments in partibus infidelium, [literally: in parts inhabited by infidels. The words are added to the title of Roman Catholic bishops appointed to purely nominal dioceses in non-Christian countries; here it means “in exile”] there were quarrels and wrangles of every kind, and the gentlemen concerned no doubt now look back on that period as the most unsuccessful of their lives.

Marx remained aloof from all of those intrigues. For a while he continued to produce his Neue Rheinische Zeitung in the form of a monthly review (Hamburg, 1850), later he withdrew into the British Museum and worked through the immense and as yet for the most part unexamined library there for all that it contained on political economy. At the same time he was a regular contributor to the New York Tribune, acting, until the outbreak of the American Civil War, so to speak, as the editor for European politics of this, the leading Anglo-American newspaper.

The coup d’etat of December 2 induced him to write a pamphlet, The Eighteenth Brumaire of Louis Bonaparte, New York, 1852, which is just now being reprinted (Meissner, Hamburg), and will make no small contribution to an understanding of the untenable position into which that same Bonaparte has just got himself. The hero of the coup d’état is presented here as he really is, stripped of the glory with which his momentary success surrounded him. The philistine who considers his Napoleon III to be the greatest man of the century and is unable now to exaplin to himself how this miraculous genius suddenly comes to be making bloomer after bloomer and one political error after the other – that same philistine can consult the aforementioned work of Marx for his edification.

Although during his whole stay in London Marx chose not to thrust himself to the fore, he was forced by Karl Vogt, after the Italian campaign of 1859, to enter into a polemic, which was brought to an end with Marx’s Herr Vogt (London, 1860). At about the same time his study of political economy bore its first fruit: A Contribution to the Critique of Political Economy, Part One, Berlin, 1859. This instalment contains only the theory of money presented from completely new aspects. The continuation was some time in coming, since the author discovered so much new material in the meantime that he considered it necessary to undertake further studies.

At last, in 1867, there appeared in Hamburg: Capital. A Critique of Political Economy, Volume I. This work contains the results of studies to which a whole life was devoted. It is the political economy of the working class, reduced to its scientific formulation. This work is concerned not with rabble-rousing phrasemongering, but with strictly scientific deductions. Whatever one’s attitude to socialism, one will at any rate have to acknowledge that in this work it is presented for the first time in a scientific manner, and that it was precisely Germany that accomplished this. Anyone still wishing to do battle with socialism, will have to deal with Marx, and if he succeeds in that then he really does not need to mention the dei minorum gentium.” [“Gods of a lesser stock;” meaning, celebrities of lesser stature.]

But there is another point of view from which Marx’s book is of interest. It is the first work in which the actual relations existing between capital and labour, in their classical form such as they have reached in England, are described in their entirety and in a clear and graphic fashion. The parliamentary inquiries provided ample material for this, spanning a period of almost forty years and practically unknown even in England, material dealing with the conditions of the workers in almost every branch of industry, women’s and children’s work, night work, etc.; all this is here made available for the first time. Then there is the history of factory legislation in England which, from its modest beginnings with the first acts of 1802, has now reached the point of limiting working hours in nearly all manufacturing or cottage industries to 60 hours per week for women and young people under the age of 18, and to 39 hours per week for children under 13. From this point of view the book is of the greatest interest for every industrialist.

For many years Marx has been the “best-maligned” of the German writers, and no one will deny that he was unflinching in his retaliation and that all the blows he aimed struck home with a vengeance. But polemics, which he “dealt in” so much, was basically only a means of self-defence for him. In the final analysis his real interest lay with his science, which he has studied and reflected on for twenty-five years with unrivalled conscientiousness, a conscientiousness which has prevented him from presenting his findings to the public in a systematic form until they satisfied him as to their form and content, until he was convinced that he had left no book unread, no objection unconsidered, and that he had examined every point from all its aspects. Original thinkers are very rare in this age of epigones; if, however, a man is not only an original thinker but also disposes over learning unequalled in his subject, then he deserves to be doubly acknowledged.

As one would expect, in addition to his studies Marx is busy with the workers’ movement; he is one of the founders of the International Working Men’s Association, which has been the centre of so much attention recently and has already shown in more than one place in Europe that it is a force to be reckoned with. We believe that we are not mistaken in saying that in this, at least as far as the workers’ movement is concerned, epoch-making organisation the German element – thanks precisely to Marx – holds the influential position which is its due.

A Brief Biographical Sketch With an Exposition of Marxism by Vladimir Lenin

  Preface

  This article on Karl Marx, which now appears in a separate printing, was written in 1913 (as far as I can remember) for the Granat Encyclopaedia. A fairly detailed bibliography of literature on Marx, mostly foreign, was appended to the article. This has been omitted in the present edition. The editor of the Encyclopaedia, for their part, have, for censorship reasons, deleted the end of the article on Marx, namely, the section dealing with his revolutionary tactics. Unfortunately, I am unable to reproduce that end, because the draft has remained among my papers somewhere in Krakow or in Switzerland. I only remember that in the concluding part of the article I quoted, among other things, the passage from Marx’s letter to Engels of April 16, 1856, in which he wrote: “The whole thing in Germany will depend on the possibility of backing the proletarian revolution by some second edition of the Peasant War. Then the affair will be splendid.” That is what our Mensheviks, who have now sunk to utter betrayal of socialism and to desertion to the bourgeoisie, have failed to understand since 1905.

N. Lenin

Moscow, May 14, 1918

 
Thanks to Marxists Internet Archive   http://www.marxists.org

Published in 1918 in the pamphlet: N. Lenin,
Karl Marx, Priobi Publishers, Moscow
Published according to the manuscript

Marx, Karl, was born...

Marx, Karl, was born on May 5, 1818 (New Style), in the city of Trier (Rhenish Prussia). His father was a lawyer, a Jew, who in 1824 adopted Protestantism. The family was well-to-do, cultured, but not revolutionary. After graduating from a Gymnasium in Trier, Marx entered the university, first at Bonn and later in Berlin, where he read law, majoring in history and philosophy. He concluded his university course in 1841, submitting a doctoral thesis on the philosophy of Epicurus. At the time Marx was a Hegelian idealist in his views. In Berlin, he belonged to the circle of “Left Hegelians” (Bruno Bauer and others) who sought to draw atheistic and revolutionary conclusion from Hegel’s philosophy.

After graduating, Marx moved to Bonn, hoping to become a professor. However, the reactionary policy of the government, which deprived Ludwig Feuerbach of his chair in 1832, refused to allow him to return to the university in 1836, and in 1841 forbade young Professor Bruno Bauer to lecture at Bonn, made Marx abandon the idea of an academic career. Left Hegelian views were making rapid headway in Germany at the time. Feuerbach began to criticize theology, particularly after 1836, and turn to materialism, which in 1841 gained ascendancy in his philosophy (The Essence of Christianity). The year 1843 saw the appearance of his Principles of the Philosophy of the Future. “One must oneself have experienced the liberating effect” of these books, Engels subsequently wrote of these works of Feuerbach. “We [i.e., the Left Hegelians, including Marx] all became at once Feuerbachians.” At that time, some radical bourgeois in the Rhineland, who were in touch with the Left Hegelians, founded, in Cologne, an opposition paper called Rheinische Zeitung (The first issue appeared on January 1, 1842). Marx and Bruno Bauer were invited to be the chief contributors, and in October 1842 Marx became editor-in-chief and moved from Bonn to Cologne. The newspaper’s revolutionary-democratic trend became more and more pronounced under Marx’s editorship, and the government first imposed double and triple censorship on the paper, and then on January 1 1843 decided to suppress it. Marx had to resign the editorship before that date, but his resignation did not save the paper, which suspended publication in March 1843. Of the major articles Marx contributed to Rheinische Zeitung, Engels notes, in addition to those indicated below (see Bibliography),^[1] an article on the condition of peasant winegrowers in the Moselle Valley.^[2] Marx’s journalistic activities convinced him that he was insufficiently acquainted with political economy, and he zealously set out to study it.

In 1843, Marx married, at Kreuznach, a childhood friend he had become engaged to while still a student. His wife came of a reactionary family of the Prussian nobility, her elder brother being Prussia’s Minister of the Interior during a most reactionary period—1850-58. In the autumn of 1843, Marx went to Paris in order to publish a radical journal abroad, together with Arnold Ruge (1802-1880); Left Hegelian; in prison in 1825-30; a political exile following 1848, and a Bismarckian after 1866-70). Only one issue of this journal, Deutsch-Französische Jahrbücher, appeared;^[3] publication was discontinued owing to the difficulty of secretly distributing it in Germany, and to disagreement with Ruge. Marx’s articles in this journal showed that he was already a revolutionary who advocated “merciless criticism of everything existing”, and in particular the “criticism by weapon”,^[13] and appealed to the masses and to the proletariat.

In September 1844, Frederick Engels came to Paris for a few days, and from that time on became Marx’s closest friend. They both took a most active part in the then seething life of the revolutionary groups in Paris (of particular importance at the time was Proudhon’s^[4] doctrine), which Marx pulled to pieces in his Poverty of Philosophy, 1847); waging a vigorous struggle against the various doctrines of petty-bourgeois socialism, they worked out the theory and tactics of revolutionary proletarian socialism, or communism Marxism). See Marx’s works of this period, 1844-48 in the Bibliography. At the insistent request of the Prussian government, Marx was banished from Paris in 1845, as a dangerous revolutionary. He went to Brussels. In the spring of 1847 Marx and Engels joined a secret propaganda society called the Communist League;^[5] they took a prominent part in the League’s Second Congress (London, November 1847), at whose request they drew up the celebrated Communist Manifesto, which appeared in February 1848. With the clarity and brilliance of genius, this work outlines a new world-conception, consistent with materialism, which also embrace the realm of social life; dialectics, as the most comprehensive and profound doctrine of development; the theory of the class struggle and of the world-historic revolutionary role of the proletariat—the creator of a new, communist society.

On the outbreak of the Revolution of February 1848,^[6] Marx was banished from Belgium. He returned to Paris, whence, after the March Revolution,^[7] he went to Cologne, Germany, where Neue Rheinische Zeitung^[8] was published from June 1, 1848, to May 19, 1849, with Marx as editor-in-chief. The new theory was splendidly confirmed by the course of the revolutionary events of 1848-49, just as it has been subsequently confirmed by all proletarian and democratic movements in all countries of the world. The victorious counter-revolution first instigated court proceedings against Marx (he was acquitted on February 9, 1849), and then banished him from Germany (May 16, 1849). First Marx went to Paris, was again banished after the demonstration of June 13, 1849,^[9] and then went to London, where he lived until his death.

His life as a political exile was a very hard one, as the correspondence between Marx and Engels (published in 1913) clearly reveals. Poverty weighed heavily on Marx and his family; had it not been for Engels’ constant and selfless financial aid, Marx would not only have been unable to complete Capital but would have inevitably have been crushed by want. Moreover, the prevailing doctrines and trends of petty-bourgeois socialism, and of non-proletarian socialism in general, forced Marx to wage a continuous and merciless struggle and sometime to repel the most savage and monstrous personal attacks (Herr Vogt).^[10] Marx, who stood aloof from circles of political exiles, developed his materialist theory in a number of historical works (see Bibliography), devoting himself mainly to a study of political economy. Marx revolutionized science (see “The Marxist Doctrine”, below) in his Contribution to the Critique of Political Economy (1859) and Capital (Vol. I, 1867).

The revival of the democratic movements in the late fifties and in the sixties recalled Marx to practical activity. In 1864 (September 28) the International Working Men’s Association—the celebrated First International—was founded in London. Marx was the heart and soul of this organization, and author of its first Address^[11] and of a host of resolutions, declaration and manifestoes. In uniting the labor movement of various forms of non-proletarian, pre-Marxist socialism (Mazzini, Proudhon, Bakunin, liberal trade-unionism in Britain, Lassallean vacillations to the right in Germany, etc.), and in combating the theories of all these sects and schools, Marx hammered out a uniform tactic for the proletarian struggle of the working in the various countries. Following the downfall of the Paris Commune (1871)—of which gave such a profound, clear-cut, brilliant effective and revolutionary analysis (The Civil War In France, 1871)—and the Bakunin-caused^[12] cleavage in the International, the latter organization could no longer exist in Europe. After the Hague Congress of the International (1872), Marx had the General Council of the International had played its historical part, and now made way for a period of a far greater development of the labor movement in all countries in the world, a period in which the movement grew in scope, and mass socialist working-class parties in individual national states were formed.

Marx’s health was undermined by his strenuous work in the International and his still more strenuous theoretical occupations. He continued work on the refashioning of political economy and on the completion of Capital, for which he collected a mass of new material and studied a number of languages (Russian, for instance). However, ill-health prevented him from completing Capital.

His wife died on December 2, 1881, and on March 14, 1883, Marx passed away peacefully in his armchair. He lies buried next to his wife at Highgate Cemetery in London. Of Marx’s children some died in childhood in London, when the family were living in destitute circumstances. Three daughters married English and French socialists; Eleanor Aveling, Laura Lafargue and Jenny Longuet. The latters’ son is a member of the French Socialist Party.

 

---

Notes

^[1] This “Bibliography” written by Lenin for the article is not included. —Ed.

^[2] The reference is to the article “Justification of the Correspondent from the Mosel” by Karl Marx.—Ed.

^[3] The reference is to the Deutsch-Franzosische Jahrbucher (German-French Annals), a magazine edited by Karl Marx and Arnold Ruge and published in German in Paris. Only the first issue, a double one, appeared, in February 1844. It included works by Karl Marx and Frederick Engels which marked the final transition of Marx and Engels to materialism and communism. Publication of the magazine was discontinued mainly as a result of basic differences of opinion between Marx and the bourgeois radical Ruge.—Ed.

^[4] Proudhonism—An unscientific trend in petty-bourgeois socialism, hostile to Marxism, so called after its ideologist, the French anarchist Pierre Joseph Proudhon. Proudhon criticized big capitalist property from the petty-bourgeois position and dreamed of perpetuating small private ownership. He proposed the foundation of “people’s” and “exchange” banks, with the aid of which the workers would be able to acquire the means of production, become handicraftsmen and ensure the just marketing of their produce. Proudhon did not understand the historic role of the proletariat and displayed a negative attitude to the class struggle, the proletarian revolution, and the dictatorship of the proletariat; as an anarchist, he denied the need for the state. Marx subjected Proudhonism to ruthless criticism in his work The Poverty of Philosophy.—Ed.

^[5] The Communist League—The first international communist organization of the proletariat founded under the guidance of Marx and Engels in London early in June 1847.

Marx and Engels helped to work out the programmatic and organizational principles of the League; they wrote its programme—the Manifesto of the Communist Party, published in February 1848.

The Communist League was the predecessor of the International Working Men’s Association (The First International). It existed until November 1852, its prominent members later playing a leading role in the First International.—Ed.

^[6] The reference is to the bourgeois revolutions in Germany and Austria which began in March 1848.—Ed.

^[7] The reference is to the bourgeois revolution in France in February 1848.—Ed.

^[8] Die Neue Rheinische Zeitung (New Rhenish Gazette)—Published in Cologne from June 1, 1848, to May 19, 1849. Marx and Engels directed the newspaper, Marx being its editor-in-chief. Lenin characterized Die Neue Rheinische Zeitung as “the finest and unsurpassed organ of the revolutionary proletariat”. Despite persecution and the obstacles placed in its way by the police, the newspaper staunchly defended the interests of revolutionary democracy, the interests of the proletariat. Because of Marx’s banishment from Prussia in May 1849 and the persecution of the other editors. Die Neue Rheinische Zeitung had to cease publication.—Ed.

^[9] The reference is to the mass demonstration in Paris organized by the Montagne, the party of the petty bourgeoisie, in protest against the infringement by the President and the majority in the Legislative Assembly of the constitutional orders established in the revolution of 1848. The demonstration was dispersed by the government.—Ed.

^[10] The reference is to Marx’s pamphlet Herr Vogt, which was written in reply to the slanderous pamphlet by Vogt, a Bonapartist agent provocateur, My Process Against “Allgemeine Zeitung”.—Ed.

^[11] The First International Workingmen’s Association was the first international tendency that grouped together all the worlds’ workers parties in one unified international party.—Ed.

^[12] Bakuninism—A trend called after its leader Mikhail Bakunin, an ideologist of anarchism and enemy of Marxism and scientific socialism.—Ed.

^[13] These words are from Marx’s “Critique of the Hegelian Philosophy of Right: Introduction.” The relevant passage reads: “The weapon of criticism cannot, of course, replace criticism by weapon, material force must be overthrown by a material force; but theory, too, becomes a material force, as soon as it grips the masses.”—Lenin

The Marxist Doctrine

Marxism is the system of Marx’s views and teachings. Marx was the genius who continued and consummated the three main ideological currents of the 19th century, as represented by the three most advanced countries of mankind: classical German philosophy, classical English political economy, and French socialism combined with French revolutionary doctrines in general. Acknowledged even by his opponents, the remarkable consistency and integrity of Marx’s views, whose totality constitutes modern materialism and modern scientific socialism, as the theory and programme of the working-class movement in all the civilized countries of the world, make it incumbent on us to present a brief outline of his world-conception in general, prior to giving an exposition of the principal content of Marxism, namely, Marx’s economic doctrine.

Philosophical Materialism

Beginning with the years 1844–45, when his views took shape, Marx was a materialist and especially a follower of Ludwig Feuerbach, whose weak point he subsequently saw only in his materialism being insufficiently consistent and comprehensive. To Marx, Feuerbach’s historic and “epoch-making” significance lay in his having resolutely broken with Hegel’s idealism and in his proclamation of materialism, which already “in the 18th century, particularly French materialism, was not only a struggle against the existing political institutions and against... religion and theology, but also... against all metaphysics” (in the sense of “drunken speculation” as distinct from “sober philosophy”). (The Holy Family, in Literarischer Nachlass^[1]) “To Hegel... ,” wrote Marx, “the process of thinking, which, under the name of ‘the Idea’, he even transforms into an independent subject, is the demiurgos (the creator, the maker) of the real world.... With me, on the contrary, the ideal is nothing else than the material world reflected by the human mind, and translated into forms of thought.” (Capital, Vol. I, Afterward to the Second Edition.) In full conformity with this materialist philosophy of Marx’s, and expounding it, Frederick Engels wrote in Anti-Duhring (read by Marx in the manuscript): “The real unity of the world consists in its materiality, and this is proved... by a long and wearisome development of philosophy and natural science....” “Motion is the mode of existence of matter. Never anywhere has there been matter without motion, or motion without matter, nor can there be.... Bit if the... question is raised: what thought and consciousness really are, and where they come from; it becomes apparent that they are products of the human brain and that main himself is a product of Nature, which has developed in and along with its environment; hence it is self-evident that the products of the human brain, being in the last analysis also products of Nature, do not contradict the rest of Nature’s interconnections but are in correspondence with them....

“Hegel was an idealist, that is to say, the thoughts within his mind were to him not the more or less abstract images [Abbilder, reflections; Engels sometimes speaks of “imprints”] of real things and processes, but on the contrary, things and their development were to him only the images, made real, of the “Idea” existing somewhere or other before the world existed.”

In his Ludwig Feuerbach—which expounded his own and Marx’s views on Feuerbach’s philosophy, and was sent to the printers after he had re-read an old manuscript Marx and himself had written in 1844-45 on Hegel, Feuerbach and the materialist conception of history—Engels wrote:

“The great basic question of all philosophy, especially of more recent philosophy, is the relation of thinking and being... spirit to Nature... which is primary, spirit or Nature.... The answers which the philosophers gave to this question split them into two great camps. Those who asserted the primary of spirit to Nature and, therefore, in the last instance, assumed world creation in some form or other... comprised the camp of idealism. The others, who regarded Nature as primary, belonged to the various schools of materialism.”

Any other use of the concepts of (philosophical) idealism and materialism leads only to confusion. Marx decidedly rejected, not only idealism, which is always linked in one way or another with religion, but also the views—especially widespread in our day—of Hume and Kant, agnosticism, criticism, and positivism^[2] in their various forms; he considered that philosophy a “reactionary” concession to idealism, and at best a “shame-faced way of surreptitiously accepting materialism, while denying it before the world.”^[3]

On this question, see, besides the works by Engels and Marx mentioned above, a letter Marx wrote to Engels on December 12, 1868, in which, referring to an utterance by the naturalist Thomas Huxley, which was “more materialistic” than usual, and to his recognition that “as long as we actually observe and think, we cannot possibly get away from materialism”, Marx reproached Huxley for leaving a “loop hole” for agnosticism, for Humism.

It is particularly important to note Marx’s view on the relation between freedom and necessity: “Freedom is the appreciation of necessity. ‘Necessity is blind only insofar as it is not understood.’” (Engels in Anti-Duhring) This means recognition of the rule of objective laws in Nature and of the dialectical transformation of necessity into freedom (in the same manner as the transformation of the uncognized but cognizable “thing-in-itself” into the “thing-for-us”, of the “essence of things” into “phenomena”). Marx and Engels considered that the “old” materialism, including that of Feuerbach (and still more the “vulgar” materialism of Buchner, Vogt and Moleschott), contained the following major shortcomings:

(1)     (2)     (3)

this materialism was “predominantly mechanical,” failing to take account of the latest developments in chemistry and biology (today it would be necessary to add: and in the electrical theory of matter); the old materialism was non-historical and non-dialectical (metaphysical, in the meaning of anti-dialectical), and did not adhere consistently and comprehensively to the standpoint of development; it regarded the “human essence” in the abstract, not as the “complex of all” (concretely and historically determined) “social relations”, and therefore merely “interpreted” the world, whereas it was a question of “changing” it, i.e., it did not understand the importance of “revolutionary practical activity”.

Dialectics

As the most comprehensive and profound doctrine of development, and the richest in content, Hegelian dialectics was considered by Marx and Engels the greatest achievement of classical German philosophy. They thought that any other formulation of the principle of development, of evolution, was one-sided and poor in content, and could only distort and mutilate the actual course of development (which often proceeds by leaps, and via catastrophes and revolutions) in Nature and in society.

“Marx and I were pretty well the only people to rescue conscious dialectics [from the destruction of idealism, including Hegelianism] and apply it in the materialist conception of Nature.... Nature is the proof of dialectics, and it must be said for modern natural science that it has furnished extremely rich [this was written before the discovery of radium, electrons, the transmutation of elements, etc.!] and daily increasing materials for this test, and has thus proved that in the last analysis Nature’s process is dialectical and not metaphysical.

“ The great basic thought,” Engels writes, “that the world is not to be comprehended as a complex of ready-made things, but as a complex of processes, in which the things apparently stable no less than their mind images in our heads, the concepts, go through an uninterrupted change of coming into being and passing away... this great fundamental thought has, especially since the time of Hegel, so thoroughly permeated ordinary consciousness that in this generality it is now scarcely ever contradicted. But to acknowledge this fundamental thought in words and to apply it in reality in detail to each domain of investigation are two different things.... For dialectical philosophy nothing is final, absolute, sacred. It reveals the transitory character of everything and in everything; nothing can endure before it except the uninterrupted process of becoming and of passing away, of endless ascendancy from the lower to the higher. And dialectical philosophy itself is nothing more than the mere reflection of this process in the thinking brain.” Thus, according to Marx, dialectics is “the science of the general laws of motion, both of the external world and of human thought.”^[4]

This revolutionary aspect of Hegel’s philosophy was adopted and developed by Marx. Dialectical materialism “does not need any philosophy standing above the other sciences.” From previous philosophy there remains “the science of thought and its laws—formal logic and dialectics.” Dialectics, as understood by Marx, and also in conformity with Hegel, includes what is now called the theory of knowledge, or epistemology, studying and generalizing the original and development of knowledge, the transition from non-knowledge to knowledge.

In our times, the idea of development, of evolution, has almost completely penetrated social consciousness, only in other ways, and not through Hegelian philosophy. Still, this idea, as formulated by Marx and Engels on the basis of Hegels’ philosophy, is far more comprehensive and far richer in content than the current idea of evolution is. A development that repeats, as it were, stages that have already been passed, but repeats them in a different way, on a higher basis (“the negation of the negation”), a development, so to speak, that proceeds in spirals, not in a straight line; a development by leaps, catastrophes, and revolutions; “breaks in continuity”; the transformation of quantity into quality; inner impulses towards development, imparted by the contradiction and conflict of the various forces and tendencies acting on a given body, or within a given phenomenon, or within a given society; the interdependence and the closest and indissoluble connection between all aspects of any phenomenon (history constantly revealing ever new aspects), a connection that provides a uniform, and universal process of motion, one that follows definite laws—these are some of the features of dialectics as a doctrine of development that is richer than the conventional one. (Cf. Marx’s letter to Engels of January 8, 1868, in which he ridicules Stein’s “wooden trichotomies,” which it would be absurd to confuse with materialist dialectics.)

The Materialist Conception of History

A realization of the inconsistency, incompleteness, and onesidedness of the old materialism convinced Marx of the necessity of “bringing the science of society... into harmony with the materialist foundation, and of reconstructing it thereupon.”^[5] Since materialism in general explains consciousness as the outcome of being, and not conversely, then materialism as applied to the social life of mankind has to explain social consciousness as the outcome of social being. “Technology,” Marx writes (Capital, Vol. I), “discloses man’s mode of dealing with Nature, the immediate process of production by which he sustains his life, and thereby also lays bare the mode of formation of his social relations, and of the mental conceptions that flow from them.”^[6] In the preface to his Contribution to the Critique of Political Economy, Marx gives an integral formulation of the fundamental principles of materialism as applied to human society and its history, in the following words:

“In the social production of their life, men enter into definite relations that are indispensable and independent of their will, relations of production which correspond to a definite stage of development of their material productive forces.

“The sum total of these relations of production constitutes the economic structure of society, the real foundation, on which rises a legal and political superstructure and to which correspond definite forms of social consciousness. The mode of production of material life conditions the social, political and intellectual life process in general. It is not the consciousness of men that determines their being, but, on the contrary, their social being that determines their consciousness. At a certain stage of their development, the material productive forces of society come in conflict with the existing relations of production, or—what is but a legal expression for the same thing—with the property relations within which they have been at work hitherto. From forms of development of the productive forces these relation turn into their fetters. Then begins an epoch of social revolution. With the change of the economic foundation the entire immense superstructure is more or less rapidly transformed. In considering such transformations a distinction should always be made between the material transformation of the economic conditions of production, which can be determined with the precision of natural science, and the legal, political, religious, aesthetic or philosophic—in short, ideological forms in which men become conscious of this conflict and fight it out.

“Just as our opinion of an individual is not based on what he thinks of himself, so we cannot judge of such a period of transformation by its own consciousness; on the contrary, this consciousness must be explained rather from the contradictions of material life, from the existing conflict between the social productive forces and the relations of production.... In broad outlines, Asiatic, ancient, feudal, and modern bourgeois modes of production can be designated as progressive epochs in the economic formation of society.”^[7] [Cf. Marx’s brief formulation in a letter to Engels dated July 7, 1866: “Our theory that the organization of labor is determined by the means of production.”]

The discovery of the materialist conception of history, or more correctly, the consistent continuation and extension of materialism into the domain of social phenomena, removed the two chief shortcomings in earlier historical theories. In the first place, the latter at best examined only the ideological motives in the historical activities of human beings, without investigating the origins of those motives, or ascertaining the objective laws governing the development of the system of social relations, or seeing the roots of these relations in the degree of development reached by material production; in the second place, the earlier theories did not embrace the activities of the masses of the population, whereas historical materialism made it possible for the first time to study with scientific accuracy the social conditions of the life of the masses, and the changes in those conditions. At best, pre-Marxist “sociology” and historiography brought forth an accumulation of raw facts, collected at random, and a description of individual aspects of the historical process. By examining the totality of opposing tendencies, by reducing them to precisely definable conditions of life and production of the various classes of individual aspects of the historical process. By examining the choice of a particular “dominant” idea or in its interpretation, and by revealing that, without exception, all ideas and all the various tendencies stem from the condition of the material forces of production, Marxism indicated the way to an all-embracing and comprehensive study of the process of the rise, development, and decline of socio-economic systems. People make their own history but what determines the motives of people, of the mass of people—i.e., what is the sum total of all these clashes in the mass of human societies? What are the objective conditions of production of material life that form the basis of all man’s historical activity? What is the law of development of these conditions? To all these Marx drew attention and indicated the way to a scientific study of history as a single process which, with all its immense variety and contradictoriness, is governed by definite laws.

The Class Struggle

It is common knowledge that, in any given society, the striving of some of its members conflict with the strivings of others, that social life is full of contradictions, and that history reveals a struggle between nations and societies, as well as within nations and societies, and, besides, an alternation of periods of revolution and reaction, peace and war, stagnation and rapid progress or decline. Marxism has provided the guidance —i.e., the theory of the class struggle—for the discovery of the laws governing this seeming maze and chaos. It is only a study of the sum of the strivings of all the members of a given society or group of societies that can lead to a scientific definition of the result of those strivings. Now the conflicting strivings stem from the difference in the position and mode of life of the classes into which each society is divided.

“The history of all hitherto existing society is the history of class struggles,” Marx wrote in the Communist Manifesto (with the exception of the history of the primitive community, Engels added subsequently). “Freeman and slave, patrician and plebeian, lord and serf, guild-master and journeyman, in a word, oppressor and oppressed, stood in constant opposition to one another, carried on an uninterrupted, now hidden, now open fight, a fight that each time ended, either in a revolutionary reconstruction of society at large, or in the common ruin of the contending classes.... The modern bourgeois society that has sprouted from the ruins of feudal society has not done away with class antagonisms. It has but established new classes, new conditions of oppression, new forms of struggle in place of the old ones. Our epoch, the epoch of the bourgeoisie, possesses, however, this distinctive feature: it has simplified class antagonisms. Society as a whole is more and more splitting up into two great hostile camps, into two great classes directly facing each other: Bourgeoisie and Proletariat.”

Ever since the Great French Revolution, European history has, in a number of countries, tellingly revealed what actually lies at the bottom of events—the struggle of classes. The Restoration period in France^[8] already produced a number of historians (Thierry, Guizot, Mignet, and Thiers) who, in summing up what was taking place, were obliged to admit that the class struggle was taking place, were obliged to admit that the class struggle was the key to all French history. The modern period—that of complete victory of the bourgeoisie, representative institutions, extensive (if not universal) suffrage, a cheap daily press that is widely circulated among the masses, etc., a period of powerful and every-expanding unions of workers and unions of employers, etc.—has shown even more strikingly (though sometimes in a very one-sided, “peaceful”, and “constitutional” form) the class struggle as the mainspring of events. The following passage from Marx’s Communist Manifesto will show us what Marx demanded of social science as regards an objective analysis of the position of each class in modern society, with reference to an analysis of each class’s conditions of development:

“Of all the classes that stand face to face with the bourgeoisie today, the proletariat alone is a really revolutionary class. The other classes decay and finally disappear in the face of Modern Industry; the proletariat is its special and essential product. The lower middle class, the small manufacturer, the shopkeeper, the artisan, the peasant, all these fight against the bourgeoisie, to save from extinction their existence as fractions of the middle class. They are therefore not revolutionary, but conservative. Nay more, they are reactionary, for they try to roll back the wheel of history. If by chance they are revolutionary, they are so only in view of their impending transfer into the proletariat; they thus defend not their present, but their future interests; they desert their own standpoint to place themselves at that of the proletariat.”

In a number of historical works (see Bibliography), Marx gave brilliant and profound examples of materialist historiography, of an analysis of the position of each individual class, and sometimes of various groups or strata within a class, showing plainly why and how “every class struggle is a political struggle.”^[9] The above-quoted passage is an illustration of what a complex network of social relations and transitional stages from one class to another, from the past to the future, was analyzed by Marx so as to determine the resultant of historical development.

Marx’s economic doctrine is the most profound, comprehensive and detailed confirmation and application of his theory.

 

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Notes

^[1] See Marx and Engels, The Holy Family (Chapter Eight)—Lenin

^[2] Agnoticism—An idealist philosophical theory asserting that the world in unknowable, that the human mind is limited and cannot know anything beyond the realms of sensations. Agnosticism has various forms: some agnostics recognize the objective existence of the material world but deny the possibility of knowing it, others deny the existence of the material world on the plea that man cannot know whether anything exists beyond his sensations.

Criticism—Kant gave this name to his idealist philosophy, considering the criticism of man’s cognitive ability to be the purpose of that philosophy. Kant’s criticism led him to the conviction that human reason cannot know the nature of things.

Positivism—A widespread trend in bourgeois philosophy and sociology, founded by Comte (1798-1857), a French philosopher and sociologist. The positivists deny the possibility of knowing inner regularities and relations and deny the significance of philosophy as a method of knowing and changing the objective world. They reduce philosophy to a summary of the data provided by the various branches of science and to a superficial description of the results of direct observation—i.e., to “positive” facts. Positivism considers itself to be “above” both materialism and idealism but it is actually nothing more than a variety of subjective idealism.—Ed.

^[3] Frederick Engels: Ludwig Feuerbach and the End of Classical German Philosophy—Lenin

^[4] Frederick Engels: Ludwig Feuerbach and the End of Classical German Philosophy—Lenin

^[5] Frederick Engels: Ludwig Feuerbach and the End of Classical German Philosophy—Lenin

^[6] See Karl Marx, Capital. Volume I.—Lenin

^[7] Karl Marx, Contribution to the Critique of Political Economy (1859)—Lenin

^[8] The Restoration—The period in France between 1814 and 1830 when power was in the hands of the Bourbons, restored to the throne after their overthrow by the French bourgeois revolution in 1792.—Ed.

^[9] See Marx and Engels, Selected Works Vol. 1, Moscow, 1973, pp. 108-09, 117-18, 116.—Ed.

Marx’s Economic Doctrine

“It is the ultimate aim of this work to lay bare the economic law of motion of modern society, i.e., capitalist, bourgeois society,”

says Marx in the preface to Capital. An investigation into the relations of production in a given, historically defined society, in their inception, development, and decline—such is the content of Marx’s economic doctrine. In capitalist society, the production of commodities is predominant, and Marx’s analysis therefore begin with an analysis of commodity.

Value

A commodity is, in the first place, a thing that satisfies a human want; in the second place, it is a thing that can be exchanged for another thing. The utility of a thing makes is a use-value. Exchange-value (or, simply, value), is first of all the ratio, the proportion, in which a certain number of use-values of one kind can be exchanged for a certain number of use-values of another kind. Daily experience shows us that million upon millions of such exchanges are constantly equating with one another every kind of use-value, even the most diverse and incomparable. Now, what is there in common between these various things. things constantly equated with one another in a definite system of social relations? Their common feature is that they are products of labor. In exchanging products, people equate the most diverse kinds of labor. The production of commodities is a system of social relations in which individual producers create diverse products (the social division of labor), and in which all these products are equated with one another in the process of exchange. Consequently, what is common to all commodities is not the concrete labor of a definite branch of production, not labor of one particular kind, but abstract human labor—human labor in general. All the labor power of a given society, as represented in the sum total of the values of all commodities, is one and the same human labor power. Thousands upon thousands of millions of acts of exchange prove this. Consequently, each particular commodity represents only a certain share of the socially necessary labor time. The magnitude of value is determined by the amount of socially necessary labor, or by the labor time that is socially necessary for the production of a given commodity, of a given use-value.

“Whenever, by an exchange, we equate as values our different products, by that very act, we also equate, as human labor, the different kind of labor expended upon them. We are not aware of this, nevertheless we do it.” [Capital]. As one of the earlier economists said, value is a relation between two persons; only he should have added: a relation concealed beneath a material wrapping. We can understand what value is only when we consider it from the standpoint of the system of social relations of production in a particular historical type of society, moreover, or relations that manifest themselves in the mass phenomenon of exchange, a phenomenon which repeats itself thousands upon thousands of time. “As values, all commodities are only definite masses of congealed labor time.” [A Contribution to the Critique of Political Economy].

After making a detailed analysis of the twofold character of the labor incorporated in commodities, Marx goes on to analyze the form of value and money. Here, Marx’s main task is to study the origin of the money form of value, to study the historical process of the development of exchange, beginning with individual and incidental acts of exchange (the “elementary or accidental form of value”, in which a given quantity of one commmodity is exchanged for a given quantity of another), passing on to the universal form of value, in which a number of different commodities are exchanged for one and the same particular commodity, and ending with the money form of value, when gold becomes that particular commodity, the universal equivalent. As the highest product of the development of exchange and commodity production, money masks, conceals, the social character of all individual labor, the social link between individual producers united by the market. Marx analyzes the various functions of money in very great detail; it is important to note here in particular (as in the opening chapters of Capital in general) that what seems to be an abstract and at times purely deductive mode of exposition deals in reality with a gigantic collection of factual material on the history of the development of exchange and commodity production.

“If we consider money, its existence implies a definite stage in the exchange of commodities. The particular functions of money, which it performs either as the mere equivalent of commodities or as means of circulation, or means of payment, as hoard or as universal money, point, according to the extent and relative preponderance of the one function or the other, to very different stages in the process of social production.” [Capital].

Surplus Value

At a certain stage in the development of commodity production money becomes transformed into capital. The formula of commodity circulation was C-M-C (commodity—money—commodity)—i.e., the sale of one commodity for the purpose of buying another.

The general formula of capital, on the contrary, is M-C-M—i.e., the purchase for the purpose of selling (at a profit).

The increase over the original value of the money that is put into circulation is called by Marx surplus value. The fact of this “growth” of money in capitalist circulation is common knowledge. Indeed, it is this “growth” which transforms money into capital, as a special and historically determined social relation of production. Surplus value cannot arise out of commodity circulation, for the latter knows only the exchange of equivalents; neither can it arise out of price increases, for the mutual losses and gains of buyers and sellers would equalize one another, whereas what we have here in not an individual phenomenon but a mass, average and social phenomenon. To obtain surplus value, the owner of money “must ... find... in the market a commodity, whose use-value possesses the peculiar property of being a source of value” [Capital]—a commodity whose process of consumption is at the same time a process of the creation of value. Such a commodity exists—human labor power. Its consumption is labor, and labor creates value. The owner of money buys labor power at its value, which, like the value of every other commodity, is determined by the socially necessary labor time requisite for its production (i.e., the cost of maintaining the worker and his family). Having bought enough labor power, the owner of money is entitled to use it, that is, to set it to work for a whole day—12 hours, let us say. Yet, in the course of six hours (“necessary” labor time) the worker creates product sufficient to cover the cost of his own maintenance; in the course of the next six hours (“surplus” labor time), he creates “surplus” product, or surplus value, for which the capitalist does not pay. Therefore, from the standpoint of the process of production, two parts must be distinguished in capital: constant capital, which is expended on means of production (machinery, tools, raw materials, etc.), whose value, without any change, is transferred (immediately or part by part) to the finished product; secondly, variable capital, which is expended on labor power. The value of this latter capital is not invariable, but grows in the labor process, creating surplus value. Therefore, to express the degree of capital’s exploitation of labor power, surplus must be compared not with the entire capital but only with variable capital. Thus, in the example just given, the rate of surplus value, as Marx calls this ratio, will be 6:6, i.e., 100 per cent.

There were two historical prerequisites for capital to arise: first, the accumulation of certain sums of money in the hands of individuals under conditions of a relatively high level of development of community production in general; secondly, the existence of a worker who is “free” in a double sense: free of all constraint or restriction on the scale of his labor power, and free from the land and all means of production in general, a free and unattached laborer, a “proletarian”, who cannot subsist except by selling his labor power.

There are two main ways of increasing surplus value: lengthening the working day (“absolute surplus value”), and reducing the necessary working day (“relative surplus value”). In analyzing the former, Marx gives a most impressive picture of the struggle of the working class for a shorter working day and of interference by the state authority to lengthen the working day (from the 14th century to the 17th) and to reduce it (factory legislation in the 19th century). Since the appearance of Capital, the history of the working class movement in all civilized countries of the world has provided a wealth of new facts amplifying this picture.

Analyzing the production of relative surplus value, Marx investigates the three fundamental historical stage in capitalism’s increase of the productivity of labor: (1) simple co-operation; (2) the division of labor, and manufacture; (3) machinery and large-scale industry. How profoundly Marx has here revealed the basic and typical features of capitalist development is shown incidentally by the fact that investigations into the handicraft industries in Russia furnish abundant material illustrating the first two of the mentioned stages. The revolutionizing effect of large-scale machine industry, as described by Marx in 1867, has revealed itself in a number of “new” countries (Russia, Japan, etc.), in the course of the half-century that has since elapsed.

To continue. New and important in the highest degree is Marx’s analysis of the accumulation of capital—i.e., the transformation of a part of surplus value into capital, and its use, not for satisfying the personal needs of whims of the capitalist, but for new production. Marx revealed the error made by all earlier classical political economists (beginning with Adam Smith), who assumed that the entire surplus value which is transformed into capital goes to form variable capital. in actual fact, it is divided into means of production and variable capital. Of tremendous importance to the process of development of capitalism and its transformation into socialism is the more rapid growth of the constant capital share (of the total capital) as compared with the variable capital share.

By speeding up the supplanting of workers by machinery and by creating wealth at one extreme and poverty at the other, the accumulation of capital also gives rise to what is called the “reserve army of labor”, to the “relative surplus” of workers, or “capitalist overpopulation”, which assumes the most diverse forms and enables capital to expand production extremely rapidly. In conjunction with credit facilities and the accumulation of capital in the form of means of production, this incidentally is the key to an understanding of the crises of overproduction which occur periodically in capitalist countries—at first at an average of every 10 years, and later at more lengthy and less definite intervals. From the accumulation of capital under capitalism we should distinguish what is known as primitive accumulation: the forcible divorcement of the worker from the means of production, the driving of the peasant off the land, the stealing of communal lands, the system of colonies and national debts, protective tariffs, and the like. “Primitive accumulation” creates the “free” proletarian at one extreme, and the owner of money, the capitalist, at the other.

The “historical tendency of capitalist accumulation” is described by Marx in the following celebrated words:

“The expropriation of the immediate producers is accomplished with merciless vandalism, and under the stimulus of passions the most infamous, the most sordid, the pettiest, the most meanly odious. Self-earned private property [of the peasant and handicraftsman], that is based, so to say, on the fusing together of the isolated, independent laboring-individual with the conditions of his labor, is supplanted by capitalistic private property, which rests on exploitation of the nominally free labor of others.... That which is now to be expropriated is no longer the laborer working for himself, but the capitalist exploiting many laborers. This expropriation is accomplished by the action of the immanent laws of capitalistic production itself, by the centralization of capital. One capitalist always kills many. Hand in hand with this centralization, or this expropriation of many capitalists by few, develop, on an ever extending scale, the co-operative form of the labor process, the conscious technical application of science, the methodical cultivation of the soil, the transformation of the instruments of labor into instruments of labor only usable in common, the economizing of all means of production by their use as the means of production of combined, socialized labor, the entanglement of all people in the net of the world market, and with this the international character of the capitalistic regime. Along with the constantly diminishing number of the magnates of capital, who usurp and monopolize all advantages of this process of transformation, grows the mass of misery, oppression, slavery, degradation, exploitation; but with this too grows the revolt of the working class, a class always increasing in numbers, and disciplined, united, organized by the very mechanism of the process of capitalist production itself. The monopoly of capital becomes a fetter upon the mode of production, which has sprung up and flourished along with, and under, it. Centralization of the means of production and socialization of labor at last reach a point where they become incompatible with their capitalist integument. The integument is burst asunder. The knell of capitalist private property sound. The expropriators are expropriated.” (Capital, Volume I)

Also new and important in the highest degree is the analysis Marx gives, in Volume Two of Capital of the reproduction of aggregate social capital. Here, too, Marx deals, not with an individual phenomenon but with a mass phenomenon; not with a fractional part of the economy of society, but with that economy as a whole. Correcting the aforementioned error of the classical economists, Marx divides the whole of social production into two big sections: (I) production of the means of production, and (II) production of articles of consumption, and examines in detail, with numerical examples, the circulation of the aggregate social capital—both when reproduced in its former dimension and in the case of accumulation. Volume Three of Capital solves the problem of how the average rate of profit is formed on the basis of the law of value. This immense stride forward made by economic science in the person of Marx consists in his having conducted an analysis, from the standpoint of mass economic phenomena, of the social economy as a whole, not from the standpoint of individual cases or of the external and superficial aspects of competition, to which vulgar political economy and the modern “theory of marginal utility”^[1] frequently restrict themselves. Marx first analyzes the origin of surplus value, and then goes on to consider its division into profit, interest, and ground rent. Profit is the ratio between surplus value and the total capital invested in an undertaking. Capital with a “high organic composition” (i.e., with a preponderance of constant capital over variable capital in excess of the social average) yields a rate of profit below the average; capital with a “low organic composition” yields a rate of profit above the average. Competition among capitalists, and their freedom to transfer their capital from one branch to another, will in both cases reduce the rate of profit to the average. The sum total of the values of all the commodities in a given society coincides with the sum total of the prices of the commodities, but, in individual undertakings and branches of production, as a result of competition, commodities are sold not at their values at the prices of production (or production prices), which are equal to the capital expended plus the average profit.

In this way, the well-known and indisputable fact of the divergence between prices and values and of the equalization of profits is fully explained by Marx on the basis of law of value, since the sum total of values of all commodities coincides with the sum total of prices. However, the equating of (social) value to (individual) prices does not take place simply and directly, but in a very complex way. It is quite natural that in a society of separate producers of commodities, who are united only by the market, a conformity to law can be only an average, social, mass manifestation, with individual deviations in either direction mutually compensating one another.

A rise in the productivity of labor implies a more rapid growth of constant capital as compared with variable capital. Inasmuch as surplus value is a function of variable capital alone, it is obvious that the rate of profit (the ratio of surplus value to the whole capital, not to its variable part alone) tends to fall. Marx makes a detailed analysis of this tendency and of a number of circumstances that conceal or counteract it. Without pausing to deal with the extremely interesting sections of Volume Three of Capital, Vol. I devoted to usurer’s capital, commercial capital and money capital, we must pass on to the most important section—the theory of ground rent. Since the area of land is limited and, in capitalist countries, the land is all held by individual private owners, the price of production of agricultural products is determined by the cost of production, not on soil of average quality but on the worst soil; not under average conditions but under the worst conditions of delivery of produce to the market. The difference between this price and the price of production on better soil (or in better conditions) constitutes differential rent. Analyzing this in detail, and showing how it arises out of the difference in fertility of different plots of land, and out of the difference in the amount of capital invested in land, Marx fully reveals (see also Theories of Surplus Value, in which the criticism of Rodbertus is most noteworthy) the error of Ricardo, who considered that differential rent is derived only when there is a successive transition from better land to worse. On the contrary, there may be inverse transitions, land may pass from one category into others (owing to advances in agricultural techniques, the growth of towns, and so on), and the notorious “law of diminishing returns”, which charges Nature with the defects, limitations and contradictions of capitalism, is profoundly erroneous. Further, the equalisation of profit in all branches of industry and the national economy in general presupposes complete freedom of competition and the free flow of capital from one branch to another. However, the private ownership of land creates monopoly, which hinders that free flow. Because of that monopoly, the products of agriculture, where a lower organic composition of capital obtains, and consequently an individually higher rate of profit, do not enter into the quite free process of the equalisation of the rate of profit. As a monopolist, the landowner can keep the price above the average, and this monopoly price gives rise to absolute rent. Differential rent cannot be done away with under capitalism, but absolute rent can—for instance, by the nationalisation of the land, by making it state property. That would undermine the monopoly of private landowners, and would mean the sole consistent and full operation of freedom of competition in agriculture. That is why, as Marx points out, bourgeois radicals have again and again in the course of history advanced this progressive bourgeois demand for nationalisation of the land, a demand which, however, frightens most of the bourgeoisie, because it would too closely affect another monopoly, one that is particularly important and “sensitive” today—the monopoly of the means of production in general. (A remarkably popular, concise, and clear exposition of his theory of the average rate of profit on capital and of absolute ground rent is given by Marx himself in a letter to Engels, dated August 2, 1862. See Briefwechsel, Volume 3, pp. 77-81; also the letter of August 9, 1862, ibid., pp. 86-87.)

With reference to the history of ground rent it is also important to note Marx’s analysis showing how labor rent (the peasant creates surplus product by working on the lord’s land) is transformed into rent paid in produce or in kind (the peasant creates surplus product by working on the lord’s land) is transformed into rent paid in produce or in kind (the peasant creates surplus product on his own land and hands it over to the landlord because of “non-economic constraint”), then into money-rent (rent in kind, which is converted into money—the obrok^[2] of old Russia—as a result of the development of commodity production), and finally into capitalist rent, when the peasant is replaced by the agricultural entrepreneur, who cultivates the soil with the help of hired labor. In connection with this analysis of the “genesis of capitalistic ground rent”, note should be taken of a number of profound ideas (of particular importance to backward countries like Russia) expressed by Marx regarding the evolution of capitalism in agriculture:

“The transformation of rent in kind into money-rent is furthermore not only inevitably accompanied, but even anticipated, by the formation of a class of propertyless day-laborers, who hire themselves out for money. During their genesis, when this new class appears but sporadically, the custom necessarily develops among the more prosperous peasants, subject to rent payments, of exploiting agricultural wage-laborers for their own account, much as in feudal times, when the more well-to-do peasant serfs themselves also held serfs. In this way, they gradually acquire the possibility of accumulating a certain amount of wealth and themselves becoming transformed into future capitalists. The old self-employed possessors of land themselves just give rise to a nursery school for capitalist tenants, whose development is conditioned by the general development of capitalist production beyond the bounds of the countryside.” [Capital, Vol. III]

“The expropriation and eviction of a part of the agricultural population not only set free for industrial capital the laborers, their means of subsistence, and material for labor; it also created the home market.” (Capital, Vol. I) In their turn, the impoverishment and ruin of the rural population play a part in the creation, for capital, or a reserve army of labor. In every capitalist country “part of the agricultural population is therefore constantly on the point of passing over into an urban or manufacturing [i.e., non-agricultural] proletariat.... This source of relative surplus population is thus constantly flowing.... The agricultural laborer is therefore reduced to the minimum of wages, and always stands with one foot already in the swamp of pauperism.” (Capital, Vol. I) The peasant’s private ownership of the land he tills is the foundation of small-scale production and the condition for its prospering and achieving the classical form. But such small-scale production is compatible only with a narrow and primitive framework of production and society. Under capitalism, the

“exploitation of the peasant differs only in form from the exploitation of the industrial proletariat. The exploiter is the same: capital. The individual capitalists exploit the individual peasant through mortgages and usury; the capitalist class exploits the peasant class through the state taxes.” [The Class Struggles in France]

“The small holding of the peasant is now only the pretext that allows the capitalist to draw profits, interest and rent from the soil, while leaving it to the tiller of the soil himself to see how he can extract his wages.” (The Eighteenth Brumaire) As a rule, the peasant cedes to capitalist society—i.e., to the capitalist class—even a part of the wages, sinking “to the level of the Irish tenant farmer—all under the pretense of being a private proprietor.” (The Class Struggles In France)

What is “one of the reasons why grain prices are lower in countries with predominant small-peasant land proprietorship than in countries with a capitalist mode of production?” [Capital, Vol. III] It is that the peasant hands over gratis to society (i.e., the capitalist class) a part of his surplus product. “This lower price [of grain and other agricultural produce] is consequently a result of the producers’ poverty and by no means of their labor productivity.” [Capital, Vol. III] Under capitalism, the small-holding system, which is the normal form of small-scale production, degenerates, collapses, and perishes.

“Proprietorship of land parcels, by its very nature, excludes the development of social productive forces of labor, social forms of labor, social concentration of capital, large-scale cattle raising, and the progressive application of science. Usury and a taxation system must impoverish it everywhere. The expenditure of capital in the price of the land withdraws this capital from cultivation. An infinite fragmentation of means of production and isolation of the producers themselves.”

(Co-operative societies, i.e., associations of small peasants, while playing an extremely progressive bourgeois role, only weakens this tendency, without eliminating it; nor must it be forgotten that these co-operative societies do much for the well-to-do peasants, and very little—next to nothing—for the mass of poor peasants; then the associations themselves become exploiters of hired labor.)

“Monstrous waste of human energy. Progressive deterioration of conditions of production and increased prices of means of production—an inevitable law of proprietorship of parcels.” [Capital, Volume III] In agriculture, as in industry, capitalism transforms the process of production only at the price of the “martyrdom of the producer.”

“The dispersion of the rural laborers over larger areas breaks their power of resistance, while concentration increases that of the town operatives. In modern agriculture, as in the urban industries, the increased productiveness and quantity of the labor set in motion are bought at the cost of laying waste and consuming by disease labor power itself. Moreover, all progress in capitalistic agriculture is a progress in the art, not only of robbing the laborer, but of robbing the soil.... Capitalist production, therefore, develops technology, and the combining together of various processes into a social whole, only by sapping the original sources of all wealth—the soil and the laborer.” [Capital, Volume III]

 

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Notes

^[1] The Theory of Marginal Utility—An economic theory that originated in the 1870s to counteract Marx’s theory of value. According to this theory, the value of commodities are estimated by their usefulness and not the amount of social labor expended on their production.—Ed.

^[2] Quit-rent.—Ed.

Socialism

From the foregoing, it is evident that Marx deduces the inevitability of the transformation of capitalist society into socialist society and wholly and exclusively from the economic law of the development of contemporary society. The socialization of labor, which is advancing ever more rapidly in thousands of forms and has manifested itself very strikingly, during the half-century since the death of Marx, in the growth of large-scale production, capitalist cartels, syndicates and trusts, as well as in the gigantic increase in the dimensions and power of finance capital, provides the principal material foundation for the inevitable advent of socialism. The intellectual and moral motive force and the physical executor of this transformation is the proletariat, which has been trained by capitalism itself. The proletariat’s struggle against the bourgeoisie, which finds expression in a variety of forms ever richer in content, inevitably becomes a political struggle directed towards the conquest of political power by the proletariat (“the dictatorship of the proletariat”). The socialization of production cannot but lead to the means of production becoming the property of society, to the “expropriation of the expropriators.” A tremendous rise in labor productivity, a shorter working day, and the replacement of the remnants, the ruins, of small-scale, primitive and disunited production by collective and improved labor—such are the direct consequences of this transformation. Capitalism breaks for all time the ties between agriculture and industry, but at the same time, through its highest developed, it prepares new elements of those ties, a union between industry and agriculture based on the conscious application of science and the concentration of collective labor, and on a redistribution of the human population (thus putting an end both to rural backwardness, isolation and barbarism, and to the unnatural concentration of vast masses of people in big cities). A new form of family, new conditions in the status of women and in the upbringing of the younger generation are prepared by the highest forms of present-day capitalism: the labor of women and children and the break-up of the patriarchal family by capitalism inevitably assume the most terrible, disastrous, and repulsive forms in modern society. Nevertheless,

“modern industry, by assigning as it does, an important part in the socially organized process of production, outside the domestic sphere, to women, to young persons, and to children of both sexes, creates a new economic foundation for a higher form of the family and of the relations between the sexes. It is, of course, just as absurd to hold the Teutonic-Christian form of the family to be absolute and final as it would be to apply that character to the ancient Roman, the ancient Greek, or the Eastern forms which, moreover, taken together form a series in historic development. Moreover, it is obvious that the fact of the collective working group being composed of individuals of both sexes and all ages, must necessarily, under suitable conditions, become a source of human development; although in its spontaneously developed, brutal, capitalistic form, where the laborer exists for the process of production, and not the process of production for the laborer, that fact is a pestiferous source of corruption and slavery.” (Capital, Vol. I, end of Chapter 13)

The factory system contains

“the germ of the education of the future, an education that will, in the ease of every child over a given age, combine productive labor with instruction and gymnastics, not only as one of the methods of adding to the efficiency of social production, but as the only method of producing fully developed human beings.” [ibid.]

Marx’s socialism places the problems of nationality and of the state on the same historical footing, not only in the sense of explaining the past but also in the sense of a bold forecast of the future and of bold practical action for its achievement. Nations are an inevitable product, an inevitable form, in the bourgeois epoch of social development. The working class could not grow strong, become mature and take shape without “constituting itself within the nation,” without being “national” (“though not in the bourgeois sense of the word”). The development of capitalism, however, breaks down national barriers more and more, does away with national seclusion, and substitutes class antagonisms for national antagonism. It is, therefore, perfectly true of the developed capitalist countries that “the workingmen have no country” and that “united action” by the workers, of the civilized countries at least, “is one of the first conditions for the emancipation of the proletariat” [Communist Manifesto]. That state, which is organized coercion, inevitably came into being at a definite stage in the development of society, when the latter had split into irreconcilable classes, and could not exist without an “authority” ostensibly standing above society, and to a certain degree separate from society. Arising out of class contradictions, the state becomes “...the state of the most powerful, economically dominant class, which, through the medium of the state, becomes also the politically dominant class, and thus acquires new means of holding down and exploiting the oppressed class. Thus, the state of antiquity was above all the state of the slave-owners for the purpose of holding down the slaves, as the feudal state was the organ of the nobility for holding down the peasant serfs and bondsmen, and the modern representative state is an instrument of exploitation of wage labor by capital.” (Engels, The Origin of the Family, Private Property and the State, a work in which the writer expounds his own views and Marx’s.) Even the democratic republic, the freest and most progressive form of the bourgeois state, does not eliminate this fact in any way, but merely modifies its form (the links between government and the stock exchange, the corruption—direct and indirect—of officialdom and the press, etc.). By leading to the abolition of classes, socialism will thereby lead to the abolition of the state as well. “The first act,” Engels writes in Anti-Dühring “by virtue of which the state really constitutes itself the representative of society as a whole—the taking possession of the means of production in the name of society—is, at the same time, its last independent act as a state. The state interference in social relations becomes superfluous in one sphere after another, and then ceases of itself. The government of persons is replaced by the administration of things and by the direction of the processes of production. The state is not ‘abolished,’ it withers away” [Anti-Dühring].

“The society that will organize production on the basis of a free and equal association of the producers will put the whole machinery of state where it will then belong: into the Museum of Antiquities, by the side of the spinning wheel and the bronze axe.” [Engels, The Origin of the Family, Private Property and the State].

Finally, as regards the attitude of Marx’s socialism towards the small peasantry, which will continue to exist in the period of the expropriation of the expropriators, we must refer to a declaration made by Engels, which expresses Marx’s views:

“...when we are in possession of state power we shall not even think of forcibly expropriating the small peasants (regardless of whether with or without compensation), as we shall have to do in the case of the big landowners. Our task relative to the small peasant consists, in the first place, in effecting a transition of his private enterprise and private possession to co-operative ones, not forcibly but by dint of example and the proffer of social assistance for this purpose. And then of course we shall have ample means of showing to the small peasant prospective advantages that must be obvious to him even today.” [Engels, The Peasant Question in France and Germany, ^[1] published by Alexeyeva; there are errors in the Russian translation. Original in Die Neue Zeit].

Tactics of the Class Struggle of the Proletariat

After examining, as early as 1844-45, one of the main shortcomings in the earlier materialism—namely, its inability to understand the conditions or appreciate the importance of practical revolutionary activity—Marx, along with his theoretical work, devoted unremitting attention, throughout his lifetime, to the tactical problems of the proletariat’s class struggle. An immense amount of material bearing on this is contained in all the works of Marx, particularly in the four volumes of his correspondence with Engels, published in 1913. This material is still far from having been brought together, collected, examined and studied. We shall therefore have to confine ourselves here to the most general and brief remarks, emphasizing that Marx justly considered that, without this aspect, materialism is incomplete, onesided, and lifeless. The fundamental task of proletarian tactics was defined by Marx in strict conformity with all the postulates of his materialist-dialectical Weltanschauung [“world-view”]. Only an objective consideration of the sum total of the relations between absolutely all the classes in a given society, and consequently a consideration of the objective stage of development reached by that society and of the relations between it and other societies, can serve as a basis for the correct tactics of an advanced class. At the same time, all classes and all countries are regarded, not statistically, but dynamically —i.e., not in a state of immobility—but in motion (whose laws are determined by the economic conditions of existence of each class). Motion, in its turn, is regarded from the standpoint, not only of the past, but also of the future, and that not in the vulgar sense it is understood in by the “evolutionists”, who see only slow changes, but dialectically: “...in developments of such magnitude 20 years are no more than a day,“ Marx wrote to Engels, “thought later on there may come days in which 20 years are embodied” (Briefwechsel, Vol. 3, p. 127).^[2]

At each stage of development, at each moment, proletarian tactics must take account of this objectively inevitable dialectics of human history, on the one hand, utilizing the periods of political stagnation or of sluggish, so-called “peaceful” development in order to develop the class-consciousness, strength and militancy of the advanced class, and, on the other hand, directing all the work of this utilization towards the “ultimate aim” of that class’s advance, towards creating in it the ability to find practical solutions for great tasks in the great days, in which “20 years are embodied”. Two of Marx’s arguments are of special importance in this connection: one of these is contained in The Poverty of Philosopy, and concerns the economic struggle and economic organizations of the proletariat; the other is contained in the Communist Manifesto and concerns the asks of the proletariat. The former runs as follows:

“Large-scale industry concentrates in one place a crowd of people unknown to one another. Competition divides their interests. But the maintenance of wages, this common interest which they have against their boss, unites them in a common thought of resistance—combination.... Combinations, at first isolated, constitute themselves into groups ... and in face of always united capital, the maintenance of the association becomes more necessary to them [i.e., the workers] than that of wages.... In this struggle—a veritable civil war—all the elements necessary for coming battle unite and develop. Once it has reached this point, association takes on a political character. (Marx, The Poverty of Philosopy, 1847)

Here we have the programme and tactics of the economic struggle and of the trade union movement for several decades to come, for all the lengthy period in which the proletariat will prepare its forces for the “coming battle.” All this should be compared with numerous references by Marx and Engels to the example of the British labor movement, showing how industrial “property” leads to attempts “to buy the proletariat” (Briefwechsel, Vol. 1, p. 136).^[3] to divert them from the struggle; how this prosperity in general “demoralizes the workers” (Vol. 2, p. 218); how the British proletariat becomes “bourgeoisified”—“this most bourgeois of all nations is apparently aiming ultimately at the possession of a bourgeois aristocracy and a bourgeois proletariat alongside the bourgeoisie” Chartists (1866; Vol. 3, p. 305)^[4]; how the British workers’ leaders are becoming a type midway between “a radical bourgeois and a worker” (in reference to Holyoak, Vol. 4, p. 209); how, owning to Britain’s monopoly, and as long as that monopoly lasts, “the British workingman will not budge” (Vol. 4, p. 433).^[5] The tactics of the economic struggle, in connection with the general course (and outcome) of the working-class movement, are considered here from a remarkably broad, comprehensive, dialectical, and genuinely revolutionary standpoint.

The Communist Manifesto advanced a fundamental Marxist principle on the tactics of the political struggle:

“The Communists fight for the attainment of the immediate aims, for the enforcement of the momentary interests of the working class; but in the movement of the present, they also represent and take care of the future of that movement.” That was why, in 1848, Marx supported the party of the “agrarian revolution” in Poland, “that party which brought about the Krakow insurrection in 1846.”^[1]

In Germany, Marx, in 1848 and 1849, supported the extreme revolutionary democrats, and subsequently never retracted what he had then said about tactics. He regarded the German bourgeoisie as an element which was “inclined from the very beginning to betray the people” (only an alliance with the peasantry could have enabled the bourgeoisie to completely achieve its aims) “and compromise with the crowned representatives of the old society.” Here is Marx’s summing-up of the German bourgeois-democratic revolution—an analysis which, incidentally, is a sample of a materialism that examines society in motion, and, moreover, not only from the aspect of a motion that is backward:

“Without faith in itself, without faith in the people, grumbling at those above, trembling before those below ... intimidated by the world storm ... no energy in any respect, plagiarism in every respect ... without initiative ... an execrable old man who saw himself doomed to guide and deflect the first youthful impulses of a robust people in his own senile interests....” (Neue Rheinische Zeitung, 1848; see Literarischer Nachlass, Vol. 3, p. 212.)^[6]

About 20 years later, Marx declared, in a letter to Engels (Briefwechsel, Vol. 3, p.224), that the Revolution of 1848 had failed because the bourgeoisie had preferred peace with slavery to the mere prospect of a fight for freedom. When the revolutionary period of 1848-49 ended, Marx opposed any attempt to play at revolution (his struggle against Schapper and Willich), and insisted on the ability to work in a new phase, which in a quasi-“peaceful” way was preparing new revolutions. The spirit in which Marx wanted this work to be conducted is to be seen in his appraisal of the situation in Germany in 1856, the darkest period of reaction: “The whole thing in Germany will depend on the possibility of backing the proletarian revolution by some second edition of the Peasant War” (Briefwechsel, Vol. 2, p. 108).^[7] While the democratic (bourgeois) revolution in Germany was uncompleted, Marx focused every attention, in the tactics of the socialist proletariat, on developing the democratic energy of the peasantry. He held that Lassalle’s attitude was “objectively... a betrayal of the whole workers’ movement to Prussia” (Vol. 3, p.210), incidentally because Lassalle was tolerant of the Junkers and Prussian nationalism.

“In a predominantly agricultural country,” Engels wrote in 1865, in exchanging views with Marx on their forthcoming joint declaration in the press, “...it is dastardly to make an exclusive attack on the bourgeoisie in the name of the industrial proletariat but never to devote a word to the patriarchal exploitation of the rural proletariat under the lash of the great feudal aristocracy” (Vol. 3, p. 217).^[8]

From 1864 to 1870, when the period of the consummation of the bourgeois-democratic revolution in Germany was coming to an end, a period in which the Prussian and Austrian exploiting classes were struggling to complete that revolution in one way or another from above, Marx not only rebuked Lassalle, who was coquetting with Bismarck, but also corrected Liebknecht, who had “lapsed into Austrophilism” and a defense of particularism; Marx demanded revolutionary tactics which would combat with equal ruthlessness both Bismarck and the Austrophiles, tactics which would not be adapted to the “victor”—the Prussian Junkers—but would immediately renew the revolutionary struggle against him despite the conditions created by the Prussian military victories (Briefwechsel, Vol. 3, pp. 134, 136, 147, 179, 204, 210, 215, 418, 437, 440-41).

In the celebrated Address of the International of September 9 1870, Marx warned the French proletariat against an untimely uprising, but when an uprising nevertheless took place (1871), Marx enthusiastically hailed the revolutionary initiative of the masses, who were “storming heaven” (Marx’s letter to Kugelmann).

From the standpoint of Marx’s dialectical materialism, the defeat of revolutionary action in that situation, as in many other, was a lesser evil, in the general course and outcome of the proletarian struggle, than the abandonment of a position already occupied, than surrender without battle. Such a surrender would have demoralised the proletariat and weakened its militancy. While fully appreciating the use of legal means of struggle during periods of political stagnation and the domination of bourgeois legality, Marx, in 1877 and 1878, following the passage of the Anti-Socialist Law,^[9] sharply condemned Most’s “revolutionary phrases”; no less sharply, if not more so, did he attack the opportunism that had for a time come over the official Social-Democratic Party, which did not at once display resoluteness, firmness, revolutionary spirit and the readiness to resort to an illegal struggle in response to the Anti-Socialist Law (Briefwechsel, Vol. 4, pp. 397, 404, 418, 422, 424; cf. also letters to Sorge).

 

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Notes

^[1] The reference is to the democratic uprising for national liberation in the Krakow Republic which in 1815 was placed under the joint control of Austria, Prussia and Russia. The rebels set up a National Government which issued a manifesto proclaiming abolition of feudal services and promising to give the peasants lands without redemption. In its other proclamations it announced the establishment of national workshops with higher wages and the introduction of equal rights for all citizens. Soon, however, the uprising was suppressed.—Ed.

 

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Notes

^[1] See Marx and Engels, Selected Works, Moscow, 1958, Vol. II, p. 433. —Ed.

Leon Trotsky

Marxism in Our Time

(April 1939)

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Written in April 1939, this article is one of Trotsky’s last affirmations of revolutionary Marxism before his murder the following year. It was the introduction to Otto Rühle’s abridged version of Capital, Volume I. It was also published as a pamphlet. This pamphlet originally appeared on the Internet on the In Defense of Marxism Web Site and is placed on the Trotsky Internet Archive with their permission.

http://www.marxists.org

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This book compactly sets forth the fundamentals of Marx’s economic teaching in Marx’s own words. After all, no one has yet been able to expound the theory of labour value better than Marx himself. The abridgment of the first volume of Capital – the foundation of Marx’s entire system of economics – was made by Mr. Otto Rühle with great care and with profound understanding of his task. First to be eliminated were obsolete examples and illustrations, then quotations from writings which today are only of historic interest, polemics with writers now forgotten, and finally numerous documents – Acts of Parliament, reports of factory inspectors, and the like – which, whatever their importance for understanding a given epoch, have no place in a concise exposition that pursues theoretical rather than historical objectives. At the same time, Mr. Rühle did everything to preserve continuity in the development of the scientific analysis as well as unity of exposition. Logical deductions and dialectic transitions of thought have not, we trust, been infringed at any point. It stands to reason that this extract calls for attentive and thoughtful perusal. To aid the reader, Mr. Otto Rühle has supplied the text with succinct marginal titles.

Certain of Marx’s argumentations, especially in the first, the most difficult chapter, may seem to the uninitiated reader far too discursory, hair-splitting, or “metaphysical”. As a matter of fact, this impression arises in consequence of the want of habit to approach overly habitual phenomena scientifically. The commodity has become such an all-pervasive, customary and familiar part of our daily existence that we, lulled to sleep, do not even attempt to consider why men relinquish important objects, needed to sustain life, in exchange for tiny discs of gold or silver that are of no earthly use whatever. The matter is not limited to the commodity. One and all of the categories (the basic concepts) of market economy seem to be accepted without analysis, as self-evident, as if they were the natural basis of human relations. Yet, while the realities of the economic process are human labour, raw materials, tools, machines, division of labour, the necessity to distribute finished products among the participants of the labour process, and the like, such categories as “commodity,” “money,” “wages,” “capital,” “profit,” “tax,” and the like are only semi-mystical reflections in men’s heads of the various aspects of a process of economy which they do not understand and which is not under their control. To decipher them, a thoroughgoing scientific analysis is indispensable.

In the United States, where a man who owns a million is referred to as being “worth” a million, market concepts have sunk in deeper than anywhere else. Until quite recently Americans gave very little thought to the nature of economic relations. In the land of the most powerful economic system economic theory continued to be exceedingly barren. Only the present deep-going crisis of American economy has bluntly confronted public opinion with the fundamental problems of capitalist society. In any event, whoever has not overcome the habit of uncritically accepting the ready-made ideological reflections of economic development, whoever has not reasoned out, in the footsteps of Marx, the essential nature of the commodity as the basic cell of the capitalist organism, will prove to be forever incapable of scientifically comprehending the most important and the most acute manifestations of our epoch.

Marx’s Method

Having established science as cognition of the objective recurrences of nature, man has tried stubbornly and persistently to exclude himself from science, reserving for himself special privileges in the shape of alleged intercourse with supersensory forces (religion), or with timeless moral precepts (idealism). Marx deprived man of these odious privileges definitely and forever, looking upon him as a natural link in the evolutionary process of material nature; upon human society as the organisation of production and distribution; upon capitalism as a stage in the development of human society.

It was not Marx’s aim to discover the “eternal laws” of economy. He denied the existence of such laws. The history of the development of human society is the history of the succession of various systems of economy, each operating in accordance with its own laws. The transition from one systems to another was always determined by the growth of the productive forces, i.e., of technique and the organisation of labour. Up to a certain point, social changes are quantitative in character and do not alter the foundations of society, i.e., the prevalent forms of property. But a point is reached when the matured productive forces can no longer contain themselves within the old forms of property; then follows a radical change in the social order, accompanied by shocks. The primitive commune was either superseded or supplemented by slavery; slavery was succeeded by serfdom with its feudal superstructure; the commercial development of cities brought Europe in the sixteenth century to the capitalist order, which thereupon passed through several stages. In his Capital, Marx does not study economy in general, but capitalist economy, which has its own specific laws. Only in passing does he refer to the other economic systems to elucidate the characteristics of capitalism.

The self-sufficient economy of the primitive peasant family has no need of a “political economy,” for it is dominated on the one hand by the forces of nature and on the other by the forces of tradition. The self-contained natural economy of the Greeks or the Romans, founded on slave labour, was ruled by the will of the slave-owner, whose “plan” in turn was directly determined by the laws of nature and routine. The same might also be said about the mediaeval estate with its peasant serfs. In all these instances economic relations were clear and transparent in their primitive crudity. But the case of contemporary society is altogether different. It destroyed the old self-contained connections and the inherited modes of labour. The new economic relations have linked cities and villages, provinces and nations. Division of labour has encompassed the planet, having shattered tradition and routine, these bonds have not composed themselves to some definite plan, but rather apart from human consciousness and foresight, and it would seem as if behind the very backs of men. The interdependence of men, groups, classes, nations, which follows from division of labour, is not directed or managed by anyone. People work for each other without knowing each other, without inquiring about one another’s needs, in the hope, and even with the assurance, that their relations will somehow regulate themselves. And by and large they do, or rather were wont to.

It is utterly impossible to seek the causes for the recurrences of capitalist society in the subjective consciousness – in the intentions or plans – of its members. The objective recurrences of capitalism were formulated before science began to think about them seriously. To this day the preponderant majority of men know nothing about the laws that govern capitalist economy. The whole strength of Marx’s method was in his approach to economic phenomena, not from the subjective point of view of certain persons, but from the objective point of view of society as a whole, just as an experimental natural scientist approaches a beehive or an anthill.

For economic science the decisive significance is what and how people do, not what they themselves think about their actions. At the base of society is not religion and morality, but nature and labour. Marx’s method is materialistic, because it proceeds from existence to consciousness, not the other way around. Marx’s method is dialectic, because it regards both nature and society as they evolve, and evolution itself as the constant struggle of conflicting forces.

Marxism and Official Science

Marx had his predecessors. Classical political economy – Adam Smith, David Ricardo – reached its full bloom before capitalism had grown old, before it began to fear the morrow. Marx paid to both great classicists the perfect tribute of profound gratitude. Nevertheless the basic error of classical economics was its view of capitalism as humanity’s normal existence for all time instead of merely as one historical stage in the development of society. Marx began with a criticism of that political economy, exposed its errors, as well as the contradictions of capitalism itself, and demonstrated the inevitability of its collapse. As Rosa Luxemburg has very aptly observed, Marx’s economic teaching is a child of classical economics, a child whose birth cost its mother her life.

Science does not reach its goal in the hermetically sealed study of the scholar, but in flesh-and-blood society. All the interests and passions that rend society asunder, exert their influence on the development of science – especially of political economy, the science of wealth and poverty. The struggle of workers against capitalists forced the theoreticians of the bourgeoisie to turn their backs upon a scientific analysis of the system of exploitation and to busy themselves with a bare description of economic facts, a study of the economic past and, what is immeasurably worse, a downright falsification of things as they are for the purpose of justifying the capitalist regime. The economic doctrine which is nowadays taught in official institutions of learning and preached in the bourgeois press offers no dearth of important factual material, yet it is utterly incapable of encompassing the economic process as a whole and discovering its laws and perspectives, nor has it any desire to do so. Official political economy is dead. Real knowledge of capitalist society can be obtained only through Marx’s Capital.

The Law of Labour Value

In contemporary society man’s cardinal tie is exchange. Any product of labour that enters into the process of exchange becomes a commodity. Marx began his investigation with the commodity and deduced from that fundamental cell of capitalist society those social relations that have objectively shaped themselves on the basis of exchange, independently of man’s will. Only by pursuing this course is it possible to solve the fundamental puzzle – how in capitalist society, in which man thinks for himself and no one thinks for all, are created the relative proportions of the various branches of economy indispensable to life.

The worker sells his labour power, the farmer takes his produce to the market, the money lender of banker grants loans, the storekeeper offers an assortment of merchandise, the industrialist builds a plant, the speculator buys and sells stocks and bonds – each having his own considerations, his own private plan, his own concern about wages or profit. Nevertheless, out of this chaos of individual strivings and actions emerges a certain economic whole, which, true, is not harmonious, but contradictory, yet does give society the possibility not merely to exist but even to develop. This means that, after all, chaos is not chaos at all, that in some way it is regulated automatically, if not consciously. To understand the mechanism whereby various aspects of economy are brought into a state of relative balance, is to discover the objective laws of capitalism.

Clearly, the laws which govern the various spheres of capitalist economy – wages, price, land, rent, profit, interest, credit, the Stock Exchange – are numerous and complex. But in the final reckoning they come down to the single law that Marx discovered and explored to the end; that is, the law of labour value, which is indeed the basic regulator of capitalist economy. The essence of that law is simple. Society has at its disposal a certain reserve of living labour power. Applied to nature, that power produces products necessary for the satisfaction of human needs. In consequence of division of labour among independent producers, the products assume the form of commodities. Commodities are exchanged for each other in a given ratio, at first directly, and eventually through the medium of gold or money. The basic property of commodities, which in a certain relationship makes them equal to each other, is the human labour expended upon them – abstract labour, labour in general – the basis and the measure of value. Division of labour among millions of scattered producers does not lead to the disintegration of society, because commodities are exchanged according to the socially necessary labour time expended upon them. By accepting and rejecting commodities, the market, as the arena of exchange, decides whether they do or do not contain within themselves socially necessary labour, thereby determines the ratios of the various kinds of commodities necessary for society, and consequently also the distribution of labour power according to the various trades.

The actual processes of the market are immeasurably more complex than has been here set forth in but a few lines. Thus, oscillating around the value of labour, prices fluctuate considerably above and below their value. The causes of these fluctuation are fully explained by Marx in the third volume of Capital, which describes “the process of capitalist production considered as a whole."

Nevertheless, great as may be the divergencies between the prices and the values of commodities in individual instances, the sum of all prices is equal to the sum of all values, for in the final reckoning only the values that have been created by human labour are at the disposal of society, and prices cannot break through this limitation, including even the monopoly prices of trusts; where labour has created no new value, there even Rockefeller can get nothing.

Inequality and Exploitation

But if commodities are exchanged for each other according to the quantity of labour invested in them, how does inequality come out of equality? Marx solved this puzzle by exposing the peculiar nature of one of the commodities, which lies at the basis of all other commodities: namely, labour power. The owner of means of production, the capitalist, buys labour power. Like all other commodities, it is evaluated according to the quantity of labour invested in it, i.e., of those means of subsistence which are necessary for the survival and the reproduction of the worker. But the consumption of that commodity – labour power – consists of work, i.e., the creation of new values. The quantity of these values is greater than those which the worker himself receives and which and which he expends for his upkeep. The capitalist buys labour power in order to exploit it. It is this exploitation which is the source of inequality.

That part of the product which goes to cover the worker’s own subsistence Marx calls necessary-product; that part which the worker produces above this, is surplus-product. Surplus-product must have been produced by the slave, or the slave-owner would not have kept any slaves. Surplus-product must have been produced by the serf, or serfdom would have been of no use to the landed gentry. Surplus-product, only to a considerably greater extent, is likewise produced by the wage worker, or the capitalist would have no need to buy labour power. The class struggle is nothing else than the struggle for surplus-product. He who owns surplus-product is master of the situation – owns wealth, owns the state, has the key to the church, to the courts, to the sciences and to the arts.

Competition and Monopoly

Relations amongst capitalists, who exploit the workers, are determined by competition, which for long endures as the mainspring of capitalist progress. Large enterprises enjoy technical, financial, organisational, economic and, last but not least, political advantages over small enterprises. The greater amount of capital, being able to exploit a greater number of workers, inevitably emerges victorious out of a contest. Such is the unalterable basis of the concentration and centralisation process of capital.

While stimulating the progressive development of technique, competition gradually consumes, not only the intermediary layers but itself as well. Over the corpses and the semi-corpses of small and middling capitalists, emerges an ever-decreasing number of ever more powerful capitalist overlords. Thus, out of “hones,” “democratic,” “progressive,” competition grows irrevocably “harmful,” “parasitic,” “reactionary” monopoly. Its sway began to assert itself in the eighties of the past century, assuming definite shape at the turn of the present century. Now the victory of monopoly is openly acknowledged by the most official representatives of bourgeois society. Competition as restraining influence, complains the former Attorney-General of the United States, Mr. Homer S. Cummings, is being gradually displaced and, in large fields, remains only “as a shadowy reminder of conditions that once existed.” Yet when in the course of his prognosis Marx had first deduced monopoly from the inherent tendencies of capitalism, the bourgeois world had looked upon competition as an eternal law of nature.

The elimination of competition by monopoly marks the beginning of the disintegration of capitalist society. Competition was the creative mainspring of capitalism and the historical justification of the capitalist. By the same token the elimination of competition marks the transformation of stockholders into social parasites. Competition had to have certain liberties, a liberal atmosphere, a regime of democracy, of commercial cosmopolitanism. Monopoly needs as authoritative a government as possible, tariff walls, “its own” sources of raw materials and arenas of marketing (colonies). The last word in the disintegration of monopolistic capital is fascism.

Concentration of Wealth and the Growth of Class Contradictions

Capitalists and their advocates try in every way to hide the real extent of the concentration of wealth from the eyes of the people as well as from the eyes of the tax collector. In defiance of the obvious, the bourgeois press is still attempting to maintain the illusion of a “democratic” distribution of capitalist investment. The New York Times, in refutation of the Marxists, points out that there are from three to five million separate employers of labour. Joint-stock companies, it is true, represent greater concentration of capital than three to five million separate employers, yet the United States does have “half a million corporations.” This sort of trifling with lump sums and average figures is resorted to, not in order to disclose, but in order to hide things as they are.

From the beginning of the war until 1923 the number of plants and factories in the United States fell from index figure 100 to 98.7, while the mass of industrial production rose from 100 to 156.3. During the years of sensational prosperity (1923-1929), when it seemed that everybody was getting rich, the number of establishments fell from 100 to 93.8, while production rose from 100 to 113. Yet the concentration of business establishments, bound by their ponderous material bodies, is far behind the concentration of their souls, i.e., ownership. In 1929 the United States did actually have more than 300,000 corporations, as the New York Times correctly observes. It is only necessary to add that 200 of these, i.e., 0.07 per cent of the entire number, directly controlled 49.2 per cent of the assets of all the corporations, four years later that ratio had already risen to 56 per cent while during the years of Roosevelt’s administration it has undoubtedly risen still higher. Inside these 200 leading corporations the actual domination belongs to a small minority. A Senate committee found out in February, 1937, that for the past twenty years the decisions of twelve of the very largest corporations have been tantamount to directives for the greater part of American industry. The number of chairmen of the board of these corporations is about the same as the number of members in the cabinet of the President of the United States, the executive branch of the republic’s government. But these chairmen of the board are immeasurably more powerful than the cabinet members.

The same processes may be observed in the banking and insurance systems. Five of the largest insurance companies in the United States have absorbed not only the other companies but even many banks. The total number of banks is reduced, chiefly in the form of so-called “mergers,” essentially by being absorbed. The extent of the turnover grows rapidly. Above the banks rises the oligarchy of super-banks. Bank capital merges with industrial capital into financial super-capital. Supposing that the concentration of industry and banks were to proceed at the same rate as during the last quarter of a century – as a matter of fact, the tempo of concentration is on the increase – in the course of the impending quarter century the monopolists will have garnered unto themselves the entire economy of the country, without leaving over so much as the widow’s mite.

The statistics of the United States are here resorted to only because they are more exact and more striking. Essentially the process of concentration is international in character. Throughout the various stages of capitalism, through phases of conjunctural cycles, through all the political regimes, through peaceful periods as well as through periods of armed conflicts, the process of the concentration of all the great fortunes into an ever-decreasing number of hands has gone on and will continue without end. During the years of the Great War, when the nations were bleeding to death, when the very bodies politic of the bourgeoisie lay crushed under the weight of national debts, when fiscal systems rolled into the abyss, dragging the middle classes after them, the monopolists were coining unprecedented profits out of the blood and muck. The most powerful companies of the United States increased their assets during the years of the war two, three, four and more times and swelled their dividends to 300, 400, 900 and more per cent.

In 1840, eight years before the publication by Marx and Engels of the Manifesto of the Communist Party, the famous French writer Alexis de Tocqueville wrote in his book on Democracy in America: “Great wealth tends to disappear, the number of small fortunes to increase.” That thought has been reiterated innumerable times, at first with reference to the United States, later with reference to those other young democracies, Australia and New Zealand. Of course, de Tocqueville’s view was already erroneous in his own day. Still, real concentration of wealth began only after the American Civil War, on the eve of which de Tocqueville died. At the beginning of the present century two per cent of the population of the United States already owned more than half of the entire wealth of the country; in 1929 the same two per cent owned three-fifths of the national wealth. At the same time 36,000 wealthy families had as great an income as 11,000,000 middling and poor families. During the crisis of 1929-1933 monopolistic establishments had no need to appeal to public charity; on the contrary, they rose higher than ever above the general decline of national economy. During the ensuing rickety industrial revival on the yeast-cakes of the New Deal the monopolists again skimmed a lot of heavy cream. The number of the unemployed decreased at best from 20,000,000 to 10,000,000; at the same time the upper crust of capitalist society – no more than 6,000 adults – garnered fantastic dividends; this is what Solicitor General Robert H. Jackson proved with figures during his tenure as Anti-Trust Assistant Attorney-General.

Ferdinand Lundberg who, for all his scholarly conscientiousness, is a rather conservative economist, wrote in his book, which created quite a stir: “The United States is owned and dominated today by a hierarchy of sixty of the richest families, buttressed by no more than ninety families of lesser wealth.” To these might be added a third tier of perhaps three hundred and fifty other families, with incomes in excess of a hundred thousand dollars a year. The predominant position there belongs to the first group of sixty families, who dominate not only the market but all the levers of government. They are the real government, “the government of money in a dollar democracy.”

Thus, the abstract concept, “monopolistic capital” is filled in for us with flesh and blood. What it means is that a handful of families, bound by ties of kinship and common interest into an exclusive capitalist oligarchy, dispose of the economic and political fortunes of a great nation. One must perforce admit that the Marxist law of concentration has worked out famously!

Has Marx’s Teaching Become Obsolete?

Questions of competition, concentration of wealth, and monopoly naturally lead to the question whether in our day Marx’s economic theory is merely of historic interest – as, for example, Adam Smith’s theory – or whether it continues to be of actual significance. The criterion for replying to that question is simple: if the theory correctly estimates the course of development and foresees the future better than other theories, it remains the most advanced theory of our time, be it even scores of years old.

The famous German economist, Werner Sombart, who was virtually a Marxist at the beginning of his career but later revised all the more revolutionary aspects of Marx’s teaching, especially those most unpalatable for the bourgeoisie, in 1928, toward the end of his career, countered Marx’s Capital with his own Capitalism, which has been translated into many languages and which is probably the best known exposition of bourgeois economic apologetics in recent times. After paying the tribute of platonic appreciation to the tenets of Capital’s author, Sombart writes at the same time, “Karl Marx prophesied: firstly, the increasing misery of wage labourers; secondly, general ‘concentration,’ with the disappearance of the class of artisans and peasants; thirdly, the catastrophic collapse of capitalism. Nothing of the kind has come to pass.” Against this erroneous prognosis Sombart counterpoises his own “strictly scientific” prognosis. “Capitalism will continue,” according to him, “ to transform itself internally in the same direction in which it has already begun to transform itself, at the time of its apogee: as it grows older, it will become more and more calm, sedate, reasonable.” Let us try to verify, if only along the basic lines, which of the two is right, Marx, with his prognosis of catastrophe, or Sombart, who in the name of all bourgeois economy, promised that matters would be adjusted “calmly, sedately, reasonably.” The reader will agree that the question is worthy of notice.

“LThe Theory of Increasing Misery”

"Accumulation of wealth at one pole,” wrote Marx sixty years before Sombart, “is therefore, at the same time accumulation of misery, agony of toil, slavery, ignorance, brutality, mental degradation, at the opposite pole, i.e., on the side of the class that produces its product in the form of capital.” That thesis of Marx’s, under the name “The Theory of Increasing Misery,” has been subjected to constant attacks by democratic and social-democratic reformers, especially during the period 1896-1914, when capitalism developed rapidly and yielded certain concessions to the workers, especially to their upper stratum. After the World War, when the bourgeoisie, frightened by its own crimes and by the October Revolution, took to the road of advertised social reforms, the value of which was simultaneously nullified by inflation and unemployment, the theory of the progressive transformation of capitalist society seemed to the reformers and to the bourgeois professors fully warranted. “The purchasing power of wage labour,” Sombart assured us in 1928, “ has increased in direct ratio to the expansion of capitalist production.”

As a matter of fact, the economic contradiction between the proletariat and the bourgeoisie was aggravated during the most prosperous periods of capitalist development, when the rise in the standard of living of certain strata of toilers, which at times was rather extensive, hid from superficial eyes the decrease of the proletariat’s share in the national income. Thus, just before falling into prostration, the industrial production of the United States increased by 50 per cent between 1920 and 1930, while the sum paid out in wages rose only by 30 per cent, which meant, Sombart’s assurances notwithstanding, a tremendous decrease of labour’s share in the national income. In 1930 began an ominous growth of unemployment, and in 1933 more or less systematic aid to the unemployed, who received in the form of relief hardly more than one-half of what they had lost in the form of wages. The illusion of the uninterrupted “progress” of all classes has vanished without a trace. The relative decline of the masses’ standard of living has been superseded by an absolute decline, workers begin by economising on skimpy entertainment, then on their clothes and finally on their food. Articles and products of average quality are superseded by shoddy ones, and the shoddy by the worst. Trade unions begin to look like the man who hangs on desperately while going down in a rapidly descending escalator.

With six per cent of the world’s population, the United States holds forty per cent of the world’s wealth. Still, one-third of the nation, as Roosevelt himself admitted, is undernourished, inadequately clothed, and lives under subhuman conditions. What is there to say, then, for the far less privileged countries? The history of the capitalist world since the last war has irrefutably borne out the so-called “theory of increasing misery.” The increase in the social polarity of society is today acknowledged not only by every competent statistician, but even by statesmen who remember the rudimentary rules of arithmetic.

The fascist regime, which merely reduced to the utmost the limit of decline and reaction inherent in any imperialist capitalism, became indispensable when the degeneration of capitalism blotted out the possibility of maintaining illusions about an increase in the proletariat’s standard of living. Fascist dictatorship means the open acknowledgment of the tendency to impoverishment, which the wealthier imperialist democracies are still trying to disguise. Mussolini and Hitler persecute Marxism with such hatred precisely because their own regime is the most horrible confirmation of the Marxist prognosis. The civilised world was indignant or pretended to be indignant when Göring, in the tone of the executioner and buffoon peculiar to him, declared that guns were more important than butter, or when Cagliostro-Casanova-Mussolini advised the workers of Italy to learn to pull in tighter the belts on their black shirts. But does not substantially the same take place in the imperialist democracies? Butter everywhere is used to grease guns. The workers of France, England, the United States learn to pull in their belts without having black shirts. In the richest country of the world millions of workers have turned into paupers living at the expense of federal, state, municipal or private charity.

The Reserve Army and the New Sub-Class of the Unemployed

The industrial reserve army makes up an indispensable component part of the social mechanics of capitalism, as much as a supply of machines and raw materials in factory warehouses or of finished products in stores. Neither the general expansion of production nor the adaptation of capital to the periodic ebb and flow of the industrial cycle would be possible without a reserve of labour-power. From the general tendency of capitalist development – the increase of constant capital (machines and raw materials) at the expense of variable capital (labour-power) – Marx drew the conclusion: “The greater the social wealth the greater is the industrial reserve Army the greater is the mass of a consolidated surplus-population the greater is official pauperism. This is the absolute general law of capitalist accumulation.”

The thesis – indissolubly bound up with the “theory of increasing misery” and for scores of years denounced as “exaggerated,” “tendentious,” and “demagogic” – has now become the irreproachable theoretical image of things as they are. The present army of unemployed can no longer be regarded as a “reserve army,” because its basic mass can no longer have any hope of returning to employment: on the contrary, it is bound to be swelled by a constant flow of additional unemployed. Disintegrating capitalism has brought up a whole generation of young people who have never had a job and have no hope of getting one. This new sub-class between the proletariat and the semi-proletariat is forced to live at the expense of society. It has been estimated that in the course of nine years (1930-1938) unemployment has taken out of the economy of the United States more than 43,000,000 labour man-years. Considering that in 1929, at the height of prosperity, there were two million unemployed in the United States and that during those nine years the number of potential workers has increased by five million, the number of lost man-years must be incomparably higher. A social regime ravaged by such a plague is sick unto death. The proper diagnosis of this malady was made nearly four score of years ago, when the disease itself was a mere germ.

The Decline of the Middle Classes

Figures which demonstrate the concentration of capital indicate therewith that the specific gravity of the middle class in production and its share of the national income have been constantly declining, while small holdings have either been completely swallowed up by the large or reduced in grade and robbed of their independence, becoming a mere badge of unendurable toil and desperate want. At the same time, it is true, the development of capitalism has considerably stimulated an increase in the army of technicians, managers, servicemen, clerks, attorneys, physicians – in a word, of the so-called “new middle classes.” But that stratum, the growth of which was already no mystery even to Marx, has little in common with the old middle class, who in the ownership of its own means of production had a tangible guarantee of economic independence. The “new middle class” is more directly dependent on the capitalists than are the workers, whose taskmaster it is in large measure, moreover, among it, too, has been noticed considerable overproduction, with its aftermath of social degradation.

“Reliable statistical information,” states a person as remote from Marxism as the already-quoted former Attorney-General Homer S. Cummings, “shows that very many industrial units have completely disappeared and that what took place was a progressive elimination of the small business man as a factor in American life.”

But, objects Sombart along with many of his forerunners and successors, notwithstanding Marx, “general concentration, with the disappearance of the class of artisans and peasants,” has not yet taken place. It is hard to say which carries more weight in such an argument, irresponsibility or bad faith. Like every theoretician, Marx began by isolating the fundamental tendencies in their pure form; otherwise, it would have been altogether impossible to understand the destiny of capitalist society. Marx himself was, however, perfectly capable of viewing the phenomena of life in the light of concrete analysis, as a product of the concentration of diverse historical factors, Surely, Newton’s laws are not invalidated by the fact that the rate of speed in the fall of bodies varies under different conditions or that the orbits of planets are subjected to disturbances.

In order to understand the so-called “tenacity” of the middle classes, it is well to bear in mind that the two tendencies, the ruination of the middle classes and the transformation of these ruined ones into proletarians, develop neither at an even pace nor to the same extent. It follows from the increasing preponderance of the machine over labour-power that the further the process of ruination of the middle classes proceeds, the more it outstrips the process of their proletarianization; indeed, at a certain juncture the latter must cease altogether and even back up.

Just as the operation of the laws of physiology yields different results in a growing than in a dying organism, so the laws of Marxist economy assert themselves differently in a developing and disintegrating capitalism., This difference is shown with especial clarity in the mutual relations of town and country. The rural population of the United States, increasing comparatively less than the total population, continued to increase in absolute figures until 1910, when it amounted to more than 32,000,000. During the subsequent twenty years, notwithstanding the rapid increase in the country’s total population, it fell to 30.4 millions, i.e., by 1.6 millions. But in 1935 it rose again to 32.8 millions swelling in comparison with 1930 by 2.4 millions. This turn of the wheel, astonishing at first glance, does not in the least refute either the tendency of the urban population to increase at the expense of the rural population, or the tendency of the middle classes to become atomised while at the same time it demonstrates most pointedly the disintegration of the capitalist system as a whole. The increase in the rural population during the period of the acute crisis of 1930-1935 is simply explained by the fact that well-nigh two million of urban population, or, speaking more to the point, two million of starving unemployed, moved into the country – to plots of land abandoned by farmers or to the farms of their kith and kin, so as to apply their labour-power, rejected by society, to productive natural economy and in order to drag out a semi-starved existence instead of starving altogether.

Hence, it is not a question of the stability of small farmers, artisans and storekeepers, but rather of the abject helplessness of their situation. Far from being a guarantee of the future, the middle class is an unfortunate and tragic relic of the past. Unable to stamp it out altogether, capitalism has managed to reduce it to the utmost degree of degradation and distress, The farmer is denied, not only the rent due him for his plot of land and the profit on his invested capital, but even a goodly portion of his wages. Similarly, the little fellows in town fret out their allotted span between economic life and death. The middle class is not proletarianized only because it is pauperised. In that it is just as hard to find an argument against Marx as in favour of capitalism.

Industrial Crisis

The end of the past and the beginning of the present century were marked by such overwhelming progress made by capitalism that cyclical crises seemed to be no more than “accidental” annoyances. During the years of almost universal capitalist optimism, Marx’s critics assured us that the national and international development of trusts, syndicates and cartels introduced planned control of the market and presaged the final triumph over crisis. According to Sombart, crises had already been “abolished” before the war by the mechanics of capitalism itself, so that “the problem of crises leaves us today virtually indifferent.” Now, a mere ten years later, these words sound like hollow mockery, while only in our own day does Marx’s prognosis loom in the full measure of its tragic cogency. In an organism with poisoned blood every incidental illness tends to become chronic in character; even so, in the rotting organism of monopolistic capitalism crises assume a particularly malignant form.

It is remarkable that the capitalist press, which half-way tries to deny the very existence of monopolies, resorts to these same monopolies in order half-way to deny capitalistic anarchy. If sixty families were to control the economic life of the United States, the New York Times observes ironically, “it would show that American capitalism, so far from being ’planless’ is organised with great neatness.” This argument misses the mark.

Capitalism has been unable to develop a single one of its trends to the ultimate end. Just as the concentration of wealth does not abolish the middle class, so monopoly does not abolish competition, but only bears down on it and mangles it. No less than the “plan” of each of the sixty families, the sundry variants of these plans are not in the least interested in coordinating the various branches of economy, but rather in increasing the profits of their own monopolistic clique at the expense of other cliques and at the expense of the entire nation. The crossing of such plans in the final reckoning only deepens the anarchy in the national economy. Monopolistic dictatorship and chaos are not mutually exclusive; rather they supplement and nourish each other.

The crisis of 1929 broke out in the United States one year after Sombart had proclaimed the utter indifference of his “science” to the very problem of crises. From the peak of unprecedented prosperity the economy of the United States was catapulted into the abyss of monstrous prostration. No one in Marx’s day could have conceived convulsions of such magnitude! The national income of the United States had risen for the first time in 1920 to sixty-nine billion dollars, only to drop the very next year to fifty billion dollars, i.e., by 27 per cent. In consequence of the prosperity of the next few years, the national income rose again, in 1929, to its highest point of eighty-one billion dollars, only to drop in 1932 to forty billion dollars, i.e., by more than half! During the nine years 1930-1938 were lost approximately forty-three million man-years of labour and 133 billion dollars of the national income, assuming the norms of labour and income of 1929, when there were “only” two million unemployed. If all this is not anarchy, what can possibly be the meaning of the word?

The “Theory of Collapse”

The minds and hearts of middle-class intellectuals and trade-union bureaucrats were almost completely enthralled by the achievements of capitalism between the time of Marx’s death and the outbreak of the World War. The idea of gradual progress (“evolution”) seemed to have been made secure for all time, while the idea of revolution was regarded as a mere relic of barbarism. Marx’s prognosis about the mounting concentration of capital, about the aggravation of class contradictions, about the deepening of crises, and about the catastrophic collapse of capitalism was not amended by partly correcting it and making it more precise, but was countered with the qualitatively contrary prognosis about the more balanced distribution of the national income, about the softening of class contradictions and about the gradual reformation of capitalist society. Jean Jaurès, the most gifted of the social-democrats of that classic epoch, hoped gradually to fill political democracy with social content. In that lay the essence of reformism. Such was the alternative prognosis. What is left of it?

The life of monopolistic capitalism in our time is a chain of crises. Each crisis is a catastrophe. The need of salvation from these partial catastrophes by means of tariff walls, inflation, increase of government spending and debts lays the ground for additional, deeper and more widespread crises. The struggle for markets, for raw material, for colonies makes military catastrophes unavoidable. All in all, they prepare revolutionary catastrophes. Truly, it is not easy to agree with Sombart that aging capitalism becomes increasingly “calm, sedate and reasonable.” It would be more apt to say that it is losing its last vestiges of reason. In any event, there is no doubt that the “theory of collapse” has triumphed over the theory of peaceful development.

The Decay of Capitalism

However expensive the control of the market has been to society, mankind up to a certain stage, approximately until the World War, grew, developed and enriched itself through partial and general crises. The private ownership of the means of production continued to be in that epoch a comparatively progressive factor. But now the blind control by the law of value refuses to render further service. Human progress is stuck in a blind alley. Notwithstanding the latest triumphs of technical thought, the material productive forces are no longer growing. The clearest and most faultless symptom of the decline is the world stagnation of the building industry, in consequence of the stoppage of new investments in the basic branches of economy. Capitalists are simply no longer able to believe in the future of their own system. Construction stimulated by the government means a rise in taxation and the contraction of the “untrammelled” national income, especially since the main part of the new government construction is directly designed for war purposes.

The marasmus has acquired a particularly malignant and degrading character in the most ancient sphere of human activity, the one most closely connected with the basic vital needs of man – in agriculture. No longer satisfied with the obstacles which private ownership in its most reactionary form, that of small land holdings, places before the development of agriculture, capitalist governments see themselves not infrequently called upon to limit production artificially with the aid of statutory and administrative measures which would have frightened artisans in the guilds at the time of their decline. It will be recorded in history that the government of the most powerful capitalist country granted premiums to farmers for cutting down on their planting, i.e., for artificially diminishing the already falling national income. The results are self-evident: despite grandiose productive possibilities, secured by experience and science, agrarian economy does not emerge from a putrescent crisis, while the number of the hungry, the preponderant majority of mankind, continues to increase faster than the population of our planet. Conservatives consider it sensible politics to defend a social order which has descended to such destructive madness and they condemn the socialist fight against such madness as destructive Utopianism.

Fascism and the New Deal

Two methods for saving historically doomed capitalism are today vying with each other in the world arena – Fascism and the New Deal, in all their manifestations. Fascism bases its programme on the demolition of labour organisations, on the destruction of social reforms and on the complete annihilation of democratic rights, in order to forestall a resurrection of the proletariat’s class struggle. The fascist state officially legalises the degradation of workers and the pauperisation of the middle classes, in the name of saving the “nation” and the “race” – presumptuous names under which decaying capitalism figures.

The policy of the New Deal, which tries to save the imperialist democracy by way of sops to the labour and farmer aristocracy, is in its broad compass accessible only to the very wealthy nations, and so in that sense it is American policy par excellence. The government has attempted to shift a part of the costs of that policy to the shoulders of the monopolists, exhorting them to raise wages and shorten the labour day and thus increase the purchasing power of the population and extend production. Léon Blum attempted to translate this sermon into elementary school French. In vain! The French capitalist like the American, does not produce for the sake of production but for profit. He is always ready to limit production, even to destroy manufactured products, if thereby his own share of the national income will be increased.

The New Deal programme is all the more inconsistent in that, while preaching sermons to the magnates of capital about the advantages of abundance over scarcity, the government dispenses premiums for cutting down on production. Is greater confusion possible? The government confutes its critics with the challenge: can you do better? What all this means is that on the basis of capitalism the situation is hopeless.

Beginning with 1933, i.e., in the course of the last six years, the federal government, the states and the municipalities have handed out to the unemployed nearly fifteen billion dollars in relief, a sum quite insufficient in itself and representing merely the smaller part of lost wages, but at the same time, considering the declining national income, a colossal sum. During 1938, which was a year of comparative economic revival, the national debt of the United States increased by two billion dollars past the thirty-eight billion dollar mark, or twelve billion dollars more that the highest point at the end of the World War. Early in 1939 it passed the 40 billion dollar mark. And then what? The mounting national debt is of course a burden on posterity. But the New Deal itself was possible only because of the tremendous wealth accumulated by past generations. Only a very rich nation could indulge itself in so extravagant a policy. But even such a nation cannot indefinitely go on living at the expense of past generations. The New Deal policy with its fictitious achievements and its very real increase in the national debt, leads unavoidably to ferocious capitalist reaction and a devastating explosion of imperialism. In other words, it is directed into the same channels as the policy of fascism.

Anomaly or Norm?

Secretary of the Interior Harold L. Ickes considers it “one of the strangest anomalies in all history” that America, democratic in form, is autocratic in substance: “America, the land of majority rule but controlled at least until 1933 (!) by the monopolies that in their turn are controlled by a negligible number of their stockholders.” The diagnosis is correct, with the exception of the intimation that with the advent of Roosevelt the rule of monopoly either ceased or weakened. Yet what Ickes calls “one of the strangest anomalies in all history,” is, as a matter of fact, the unquestionable norm of capitalism. The domination of the weak by the strong, of the many by the few, of the toilers by the exploiters is a basic law of bourgeois democracy. What distinguishes the United States from other countries is merely the greater scope and the greater heinousness in the contradictions of its capitalism. The absence of a feudal past, rich natural resources, an energetic and enterprising people, in a word, all the prerequisites that augured an uninterrupted development of democracy, have actually brought about a fantastic concentration of wealth.

Promising this time to wage the fight against monopolies to a triumphant issue, Ickes recklessly harks back to Thomas Jefferson, Andrew Jackson, Abraham Lincoln, Theodore Roosevelt and Woodrow Wilson as the predecessors of Franklin D. Roosevelt. “Practically all or our greatest historical figures,” said he on December 30, 1937, “are famous because of their persistent and courageous fight to prevent and control the over-concentration of wealth and power in a few hands.” But it follows from his own words that the fruit of this “persistent and courageous fight” is the complete domination of democracy by the plutocracy.

For some inexplicable reason Ickes thinks that this time victory is assured, provided the people understand that the fight is “not between the New Deal and the average enlightened businessman, but between the New Deal and Bourbons of the sixty families who have brought the rest of the businessmen in the United States under the terror of their domination.” This authoritative spokesman does not explain just how the “Bourbons” managed to subjugate all the enlightened businessmen, notwithstanding democracy and the efforts of the “greatest historical figures.” The Rockefellers, the Morgans, the Mellons, the Vanderbilts, the Guggenheims, the Fords and Co. did not invade the United States from the outside, as Cortez invaded Mexico; they grew organically out of the “people,” or more precisely, out of the class of “enlightened industrialist and businessmen” and became, in line with Marx’s prognosis, the natural apogee of capitalism. Since a young and strong democracy in its hey-day was unable to check the concentration of wealth when the process was only at its inception, is it possible to believe even for a minute that a decaying democracy is capable of weakening class antagonisms that have attained their utmost limit? Anyway, the experience of the New Deal has produced no ground for such optimism. Refuting the charges of big business against the government, Robert H. Jackson, a person high in the councils of the administration, proved with figures that during Roosevelt’s tenure the profits of the magnates of capital reached heights they themselves had unlearned to dream about during the last period of Hoover’s presidency, from which it follows, in any event, that Roosevelt’s fight against monopolies has been crowned with no greater success than the struggle of all his predecessors.

Although they feel themselves called upon to defend the foundations of capitalism, the reformers in the very nature of things prove themselves powerless to harness its laws with economic police measures, What else can they do then but moralise? Mr. Ickes, like the other cabinet members and publicists of the New Deal, winds up by appealing to the monopolists not to forget decency and the principles of democracy. Just how is this better than prayers for rain? Surely, Marx’s view of the owner of the means of production is far more scientific, “As a capitalist,” we read in Capital, “he is merely personified capital. His soul is the soul of capital. But capital has only one single aim in life, to create surplus value.” If the capitalist’s behaviour were determined by the attributes of his individual soul or of the lyrical effusions of the Secretary of the Interior, neither average prices not average wages would be possible, nor bookkeeping, nor all of capitalist economy. Yet bookkeeping continues to flourish and is a strong argument in favour of the materialistic conception of history.

Judicial Quackery

"Unless we destroy monopoly,” said the former United States Attorney General Homer S. Cummings in November, 1937, “monopoly will find ways to destroy most of our reform and, in the end, lower the standards of our common life.” Citing startling figures to prove that “the trend to an undue concentration of wealth and economic control was unmistakable,” Cummings was at the same time forced to admit that the legislative and judicial fight against the trusts has so far led nowhere. “A sinister intent,” he complained, “is difficult to establish” when it is a matter of “economic results.” That’s just the point! Worse than that: the judicial struggle against trusts has brought about “confusion worse confounded.” This happy pleonasm rather aptly expresses the helplessness of democratic justice in its fight against the Marxist law of value. There are no grounds for hope that Mr. Cummings’ successor, Mr. Frank Murphy, will be more fortunate in solving these tasks, the very posing of which testifies to the hopeless quackery in the sphere of economic thought.

To Bring Back Yesterday

One cannot but agree with Professor Lewis W. Douglas, the former Director of the Budget in the Roosevelt Administration, when he condemns the government for “attacking monopoly in one field while fostering monopoly in many others.” Yet in the nature of the thing it cannot be otherwise. According to Marx, the government is the executive committee of the ruling class.

Today monopolists are the strongest section of the ruling class. The government is in no position to fight against monopoly in general, i.e., against the class by whose will it rules. While attacking one phase of monopoly, it is obliged to seek an ally in other phases of monopoly. In union with banks and light industry it can deliver occasional blows against the trusts of heavy industry, which, by the way do not stop earning fantastic profits because of that.

Lewis Douglas does not counterpose science to the official quackery, but merely another kind of quackery. He sees the source of monopoly not in capitalism but in protectionism, and accordingly, discovers the salvation of society not in the abolition of private ownership of the means of production but in the lowering of customs tariffs. “Unless the freedom of markets is restored,” he predicts, it is “doubtful that the freedom of all institutions – enterprise, speech, education, religion – can survive.” In other words, without restoring the freedom of international trade, democracy, wherever and to the extent that it still survives, must yield either to a revolutionary or to a fascist dictatorship. But freedom of international trade is inconceivable without freedom of internal trade, i.e., without competition. And freedom of competition is inconceivable under the sway of monopoly. Unfortunately, Mr. Douglas, quite like Mr. Ickes, like Mr. Jackson, like Mr. Cummings, and like Mr. Roosevelt himself, has not gone to the trouble to initiate us into his own prescription against monopolistic capitalism and thereby – against either a revolution or a totalitarian regime.

Freedom of trade, like freedom of competition, like the prosperity of the middle class, belongs to the irrevocable past. To bring back yesterday, is now the sole prescription of the democratic reformers of capitalism; to bring back more “freedom to small and middle-sized industrialists and businessmen, to change the money and credit system in their favour, to free the market from being bossed by the trusts, to eliminate professional speculators from the Stock Exchange, to restore freedom of international trade, and so forth ad infinitum. The reformers even dream of limiting the use of machines and placing a proscription on technique, which disturbs the social balance and causes a lot of worry. A propos of that a leading American scientist remarked with a bitter sneer that apparently security could be achieved only by returning to the happy amoeba or, failing this, to the contented swine.

Millikan and Marxism

Yet unfortunately, this very scientist, Dr. Robert A. Millikan, likewise looks backward rather than forward. Speaking in defence of science on December 7, 1937, he observed: “United States statistics show that the percentage of the population ’gainfully employed’ has steadily increased during the last fifty years, when science has been most rapidly applied.” This defence of capitalism under the guise of defending science cannot be called a happy one. It is precisely during the last half century that “was broken the link of times” and the interrelation of economics and technique altered sharply. The period referred to by Millikan includes the beginning of capitalist decline as well as the highest point of capitalist prosperity.

To hush up the beginning of that decline, which is world-wide, is to stand forth as an apologist for capitalism. Rejecting socialism in an off-hand manner with the aid of arguments that would scarcely do honour even to Henry Ford, Dr. Millikan tells us that no system of distribution can satisfy the needs of man without raising the range of production. Undoubtedly! But it is a pity that the famous physicist did not explain to the millions of American unemployed just how they were to participate in raising the national income. Abstract preachment about the saving grace of individual initiative and high productivity of labour will certainly not provide the unemployed with jobs, nor will it fill the budgetary deficit, nor will it lead the nation’s business out of its blind alley.

What distinguished Marx is the universality of his genius, his ability to understand phenomena and processes of various fields in their inherent connection. Without being a specialist in natural sciences, he was one of the first to appreciate the significance of the great discoveries in that field; for example, the theory of Darwinism. Marx was assured that preeminence not so much by virtue of his intellect as by virtue of his method. Bourgeois-minded scientists may think that they are above Socialism; yet Robert Millikan’s case is but one more confirmation that in the sphere of sociology they continue to be hopeless quacks. They should learn scientific thinking from Marx.

Productive Possibilities and Private Ownership

In his message to Congress at the beginning of 1937 President Roosevelt expressed his desire to raise the national income to ninety or one hundred billion dollars, without, however, indicating just how. In itself this programme is exceedingly modest. In 1929, when there were approximately two million unemployed, the national income reached eighty-one billion dollars. Setting in motion the present productive forces would not only suffice to realise Roosevelt’s programme but even to surpass it considerably. Machines, raw materials, workers, everything is available, not to mention the population’s need for the products. If notwithstanding that, the plan is unrealisable – and unrealisable it is – the only reason is the irreconcilable antagonism that has developed between capitalist ownership and society’s need for expanding production. The famous government-sponsored National Survey of Potential Production Capacity came to the conclusion that the cost of production and services used in 1929 amounted to nearly ninety-four billion dollars, calculated on the basis of retail prices. Yet if all the actual productive possibilities were utilised, that figure would have risen to 135 billion dollars, which would have averaged $4,370.00 a year per family, sufficient to secure a decent and comfortable living. It must be be added that the calculations of the National Survey are based on the present productive organisation of the United States, as it came about in consequence of capitalism’s anarchic history. If the equipment itself were re-equipped on the basis of a unified socialist plan, the productive calculations could be considerably surpassed and a high comfortable standard of living, on the basis of an extremely short labour day assured to all the people.

Therefore, to save society, it is not necessary either to check the development of technique, to shut down factories, to award premiums to farmers for sabotaging agriculture, to turn a third of the workers into paupers, or to call upon maniacs to be dictators. Not one of these measures, which are a shocking mockery of the interests of society, are necessary. What is indispensable and urgent is to separate the means of production from their present parasitic owners and to organise society in accordance with a rational plan. Then it would at once be possible really to cure society of its ills. All those able to work would find a job. The work-day would gradually decrease. The wants of all members of society would secure increasing satisfaction. The words “property,” “crisis,” “exploitation,” would drop out of circulation. Mankind would at last cross the threshold into true humanity.

The Inevitability of Socialism

“Along with the constantly diminishing number of the magnates of capital ...” says Marx, “grows the mass of misery, oppression, slavery, degradation, exploitation; but with this too grows the revolt of the working class, a class always increasing in numbers, and disciplined, united, organised by the very mechanism of the process of capitalist production itself. Centralisation of the means of production and socialisation of labour at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.” That is the Socialist revolution. To Marx, the problem of reconstituting society did not arise from some prescription, motivated by his personal predilections; it followed, as an iron-clad historical necessity – on the one hand, from the productive forces grown to powerful maturity; on the other, from the impossibility further to foster these forces at the mercy of the law of value. The lucubrations of certain intellectuals on the theme that, regardless of Marx’s teaching, socialism is not inevitable but merely possible, are devoid of any content whatsoever. Obviously, Marx did not imply that socialism would come about without man’s volition and action: any such idea is simply an absurdity. Marx foretold that out of the economic collapse in which the development of capitalism must inevitably culminate – and this collapse is before our very eyes – there can be no other way out except socialisation of the means of production. The productive forces need a new organiser and a new master, and, since existence determines consciousness, Marx had no doubt that the working class, at the cost of errors and defeats, will come to understand the actual situation and, sooner or later, will draw the imperative practical conclusions.

That socialisation of the capitalist-created means of production is of tremendous economic benefit is today demonstrable not only in theory but also by the experiment of the USSR, notwithstanding the limitations of that experiment. True, capitalistic reactionaries, not without artifice, use Stalin’s regime as a scarecrow against the ideas of socialism. As a matter of fact, Marx never said that socialism could be achieved in a single country, and moreover, a backward country. The continuing privations of the masses in the USSR, the omnipotence of the privileged caste, which has lifted itself above the nation and its misery, finally, the rampant club-law of the bureaucrats are not consequences of the socialist method of economy but of the isolation and backwardness of the USSR caught in the ring of capitalist encirclement. The wonder is that under such exceptionally unfavourable conditions planned economy has managed to demonstrate its insuperable benefits.

All the saviours of capitalism, the democratic as well as the fascist kind, attempt to limit, or at least to camouflage, the power of the magnates of capital, in order to forestall “the expropriation of the expropriators.” They all recognise, and many of them openly admit, that the failure of their reformist attempts must inevitably lead to socialist revolution. They have all managed to demonstrate that their methods of saving capitalism are but reactionary and helpless quackery. Marx’s prognosis about the inevitability of socialism is thus fully confirmed by proof of the negative.

The Inevitability of Socialist Revolution

The programme of “Technocracy,” which flourished in the period of the great crisis of 1929-1932, was founded on the correct premise that economy can be rationalised only through the union of technique at the height of science and government at the service of society. Such a union is possible, provided technique and government are liberated from the slavery of private ownership. That is where the great revolutionary task begins. In order to liberate technique from the cabal of private interests and place the government at the service of society, it is necessary to “expropriate the expropriators.” Only a powerful class, interested in its own liberation and opposed to the monopolistic expropriators, is capable of consummating this task. Only in unison with a proletarian government can the qualified stratum of technicians build a truly scientific and a truly national, i.e., a socialist economy.

It would be best, of course, to achieve this purpose in a peaceful, gradual, democratic way. But the social order that has outlived itself never yields its place to its successor without resistance. If in its day the young forceful democracy proved incapable of forestalling the seizure of wealth and power by the plutocracy, is it possible to expect that a senile and devastated democracy will prove capable of transforming a social order based on the untrammelled rule of sixty families? Theory and history teach that a succession of social regimes presupposes the highest form of the class struggle, i.e., revolution. Even slavery could not be abolished in the United States without a civil war. “Force is the midwife of every old society pregnant with a new one.” No one has yet been able to refute Marx on this basic tenet in the sociology of class society. Only a socialist revolution can clear the road to socialism.

Marxism in the United States

The North American republic has gone further than others in the sphere of technique and the organisation of production. Not only Americans but all of mankind will build on that foundation. However, the various phases of the social process in one and the same nation have varying rhythms, depending on special historical conditions. While the United States enjoys tremendous superiority in technology, its economic thought is extremely backward in both the right and left wings. John L. Lewis has about the same views as Franklin D. Roosevelt. Considering the nature of his office, Lewis’ social function is incomparably more conservative, not to say reactionary, than Roosevelt’s. In certain American circles there is a tendency to repudiate this or that radical theory without the slightest scientific criticism, by simply dismissing it as “un-American.” But where can you find the differentiating criterion of that?

Christianity was imported into the United States along with logarithms, Shakespeare’s poetry, notions on the rights of man and the citizen, and certain other not unimportant products of human thought. Today Marxism stands in the same category.

Secretary of Agriculture Henry A. Wallace imputed to the author of these lines, “a dogmatic thinness which is bitterly un-American” and counterposed to Russian dogmatism the opportunist spirit of Jefferson, who knew how to get along with his opponents, Apparently, it has never occurred to Mr. Wallace that a policy of compromise is not a function of some immaterial national spirit, but a product of material conditions. A nation rapidly growing rich has sufficient reserves for conciliation between hostile classes and parties. When, on the other hand, social contradictions are sharpened, the ground for compromise disappears. America was free of “dogmatic thinness” only because it had a plethora of virgin areas, inexhaustible resources of natural wealth and, it would seem, limitless opportunities for enrichment. True, even under these conditions the spirit of compromise did not prevent the Civil War when the hour for it struck. Anyway, the material conditions which made up the basis of “Americanism,” are today increasingly relegated to the past. Hence the profound crisis of traditional American ideology.

Empiric thinking, limited to the solution of immediate tasks from time to time, seemed adequate enough in labour as well as in bourgeois circles as long as Marx’s laws of value did everybody’s thinking. But today that very law is in irreconcilable contradiction with itself. Instead of urging economy forward, it undermines its foundations. Conciliatory eclectic thinking, with its philosophic apogee, pragmatism, becomes utterly inadequate, while an unfavourable or disdainful attitude toward Marxism as a “dogma” – is increasingly insubstantial, reactionary and downright funny. On the contrary, it is the traditional idea of “Americanism” that have become lifeless, petrified “dogma” giving rise to nothing but errors and confusion. At the same time, the economic teaching of Marx has acquired peculiar viability and pointedness for the United States. Although Capital rests on international material, preponderantly English, in its theoretical foundation it is an analysis of pure capitalism, capitalism in general, capitalism as such. Undoubtedly, the capitalism grown on the virgin, unhistorical soil of America comes closest to that ideal type of capitalism.

Saving Mr. Wallace’s presence, America developed economically not in accordance with the principles of Jefferson, but in accordance with the ideas of Marx. There is as little offence to national self-esteem in acknowledging that as in recognising that America turns around the sun in accordance with the laws of Newton. The more Marx is ignored in the United States, the more compelling becomes his teaching now. Capital offers a faultless diagnosis of the malady and an irreplaceable prognosis. In that sense the teaching of Marx is far more permeated with new “Americanism” than the ideas of Hoover and Roosevelt, of Green and Lewis.

True, there is a widespread original literature in the United States devoted to the crisis of American economy. In so far as conscientious economists offer an objective picture of the destructive trends of American capitalism, their investigations, regardless of their theoretical premises, which are usually lacking anyway, look like direct illustrations of Marx’s theory. The conservative tradition makes itself known, however, when these authors stubbornly restrain themselves from definitive conclusion, limiting themselves to gloomy predictions or such edifying banalities as “the country must understand,” “public opinion must certainly consider,” and the like. These books look like a knife without a blade or like a compass without its indicator.

The United States had Marxists in the past, it is true, but they were a strange type of Marxist, or rather, three strange types. In the first place, these were the émigrés cast out of Europe, who did what they could but could not find any response; in the second place, isolated American groups, like the De Leonists, who in the course of events, and because of their own mistakes, turned themselves into sects; in the third place, dilettantes attracted by the October Revolution and sympathetic to Marxism as an exotic teaching that had little to do with the United States. Their day is over. Now dawns the new epoch of an independent class movement to the proletariat and at the same time of – genuine Marxism. In this too, America will in a few jumps catch up with Europe and outdistance it. Progressive technique and a progressive social structure will pave their own way in the sphere of doctrine. The best theoreticians of Marxism will appear on American soil. Marx will become the mentor of the advanced American workers. To them this abridged exposition of the first volume will become only an initial step toward the complete Marx.

Capitalism’s Ideal Mirror

At the time the first volume of Capital was published world domination by the British bourgeoisie was as yet unchallenged. The abstract laws of commodity economy naturally found their fullest embodiment – i.e., the one least dependent on past influence – in the country where capitalism had achieved its highest development. While relying in his analysis mainly on England, Marx had not only England in view, but the entire capitalist world. He used the England of his day as capitalism’s best contemporaneous mirror.

Now only memories are left of British hegemony. The advantages of capitalistic primogeniture have turned into disadvantages. England’s technical and economic structure has become outworn. The country continues to depend for its world position on the colonial empire, a heritage of the past, rather than on an active economic potential. That explains, incidentally, Chamberlain’s Christian charity toward the international gangsterism of the fascists, which has so astonished everybody. The English bourgeoisie cannot help realising that its economic decline has become thoroughly incompatible with its position in the world and that a new war threatens to bring about the downfall of the British Empire. Essentially similar is the economic basis of France’s “pacifism.”

Germany on the contrary, has utilised in its rapid capitalistic ascent the advantages of historic backwardness, by arming itself with the most complete technique in Europe. Having a narrow national base and paucity of natural resources, Germany’s dynamic capitalism of necessity became transformed into the most explosive factor in the so-called balance of world powers. Hitler’s epileptic ideology is only a reflected image of the epilepsy of German capitalism.

In addition to numerous invaluable advantages of a historical character, the development of the United States enjoyed the preeminence of an immeasurably larger territory and incomparably greater natural wealth than Germany’s. Having considerably outstripped Great Britain, the North American republic became at the beginning of this century the chief stronghold of the world bourgeoisie. There all potentialities implanted in capitalism found their highest expression. Nowhere else on our planet can the bourgeoisie in any way exceed its achievements in the dollar republic, which has become for the twentieth century capitalism’s most perfect mirror.

For the same reasons that Marx preferred to base his exposition on English statistics, English parliamentary reports, English Blue Books, and the like, we have resorted in our modest introduction to evidence chiefly from the economic and political experience of the United States. It would not be difficult, needless to say, to cite analogous facts and figures from the life of any other capitalist country. But that would not add anything essential. The conclusions would remain the same, only the examples would be less striking.

The economic policy of the Popular Front in France, was as one of its financiers aptly put it, an adaptation of the New Deal “for Lilliputians.” It is perfectly obvious that in a theoretical analysis it is immeasurably more convenient to deal with Cyclopean than with Lilliputian magnitudes. It is the very immensity of Roosevelt’s experiment which shows that only a miracle can save the world-wide capitalist system. But it so happens that the development of capitalist production put a stop to the production of miracles. Incantations and prayers abound, miracles never come. However, it is clear that if the miracle of capitalism’s rejuvenation could happen anywhere at all, it would be nowhere else but in the United States. Yet this rejuvenation was not achieved. What the Cyclops failed to attain, the Lilliputians are even less able to accomplish. To lay the foundation for that simple conclusion, is the sense of our excursion into the field of American economy.

Mother Countries and Colonies

"The country that is more developed industrially,” Marx wrote in the preface to the first edition of his Capital, “only shows to the less developed the image of its own future.” Under no circumstances can this thought be taken literally. The growth of productive forces and the deepening of social inconsistencies is undoubtedly the lot of every country that has set out on the road of bourgeois development. However, the disproportion of tempos and standards, which goes through all of mankind’s development and basically has its natural as well as its historical reasons, not only became especially acute under capitalism, but gave rise to the complex interdependence of subordination, exploitation, and oppression between countries of different economic types.

Only a minority of countries has fully gone through that systematic and logical development from handicraft through domestic manufacture to the factory, which Marx subjected to such detailed analysis. Commercial, industrial and financial capital invaded backward countries for the outside, partly destroying the primitive forms of native economy and partly subjecting them to the world-wide industrial and banking system of the West. Under the whip of imperialism the colonies and semi-colonies found themselves compelled to disregard the intervening stages, at the same time artificially hanging on at one level or another. India’s development did not duplicate England’s development; it was a supplement to it. However, in order to understand the combined type of development of backward and dependent countries like India, it is always necessary to bear in mind the classical scheme Marx derived from England’s development. The law of labour value guides equally the calculations of speculators in London’s City and the money changing transactions in the most remote corners of Hyderabad, except that in the latter case it assumes more simple and less crafty forms.

Disproportion of development brought tremendous benefits to the advanced countries, which although in varying degrees, continued to develop at the expense of the backward ones, by exploiting them, by converting them into their colonies, or at least, by making it impossible for them to get in among the capitalist aristocracy. The fortunes of Spain, Holland, England, France were obtained not only from the surplus labour of their own proletariat, not only by devastating their own petty bourgeoisie, but also through the systematic pillage of their overseas possessions. The exploitation of classes was supplemented, and its potency increased by the exploitation of nations. The bourgeoisie of the mother countries was enabled to secure a privileged position for its own proletariat, especially the upper layers, by paying for it with some of the superprofits garnered in the colonies, Without that any sort of stable democratic regime would be utterly impossible. In its expanded manifestation bourgeois democracy became, and continues to remain, a form of government accessible only to the most aristocratic and the most exploitive nations. Ancient democracy was based on slavery, imperialist democracy – on the spoliation of colonies.

The United States, which formally has almost no colonies, is nevertheless the most privileged of all the nations of history. Active immigrants form Europe took possession of an exceedingly rich continent, exterminated the native population, seized the best part of Mexico and bagged the lion’s share of the world’s wealth. The deposits of fat thus accumulated continue to be useful even now, in the epoch of decline, for greasing the gears and wheels of democracy.

Recent historical experience, as well as theoretical analysis, attests that the rate of a democracy’s development and its stability are in inverse ration to the tension of class contradictions. In the less privileged capitalist counties (Russia, on the one hand; Germany, Italy and the like, on the other), which were unable to engender a numerous and stable labour aristocracy, democracy was never developed to any extent and succumbed to dictatorship with comparative ease. However, the continuing progressive paralysis of capitalism is preparing the same fate for the democracies of the most privileged and the richest nations; the only difference is in dates. The uncontrollable deterioration in the living conditions of the workers makes it less and less possible for the bourgeoisie to grant the masses the right of participation in political life, even within the limited framework of bourgeois parliamentarism. Any other explanation of the manifest process of democracy’s dislodgement by fascism is an idealistic falsification of things as they are, either deception of self-deception.

While destroying democracy in the old mother countries of capital, imperialism at the same time hinders the rise of democracy in the backward countries. The fact that in the new epoch not a single one of the colonies or semi-colonies has consummated its democratic revolution – above all in the field of agrarian relations – is entirely due to imperialism, which has become the chief brake on economic and political progress. Plundering the natural wealth of the backward countries and deliberately restraining their independent industrial development, the monopolistic magnates and their governments simultaneously grant financial, political and military support to the most reactionary, parasitic, semi-feudal groups of native exploiters. Artificially preserved agrarian barbarism is today the most sinister plague of contemporary world economy. The fight of the colonial peoples for their liberation, passing over the intervening stages, transforms itself of necessity into a fight against imperialism, and thus aligns itself with the struggle of the proletariat in the mother countries. Colonial uprisings and wars in their turn rock the foundations of capitalist world more than ever and render the miracle of its regeneration less than ever possible.

Planned World Economy

Capitalism achieved the twin historical merit of having placed technique on a high level and having bound all parts of the world with economic ties. Thus it pledged the material prerequisites for the systematic utilisation of all of our planet’s resources. However, capitalism is in no position to fulfill this urgent task. The nisus of its expansion continues to consist of circumscribed nationalist states with their customs houses and armies. Yet the productive forces have long outgrown the boundaries of the national state, thereby transforming what was once a progressive historical factor into an unendurable restraint. Imperialist wars are nothing else that the detonations of productive forces against the state borders, which have come to be too confining for them. The programme of so-called autarchy has nothing to do with going back to a self-sufficient circumscribed economy. It only seems that the national base is being made ready for a new war.

After the Versailles Treaty was signed it was generally believed that the terrestrial globe had been pretty well subdivided. But more recent events have served to remind us that our planet continues to contain lands that have not yet been either plundered or sufficiently plundered. Italy has enslaved Abyssinia. Japan is trying to possess China. Tired of waiting for the return of its former colonies, Germany transformed Czechoslovakia into a colony. Italy broke into Albania. The fate of the Balkan Peninsula is in question. The United States is alarmed by the encroachments of “outsiders” in Latin America. The struggle for colonies continues to be part and parcel of the policy of imperialistic capitalism. No matter how thoroughly the world is divided, the process never ends, but only again and again places on the order of the day the question of a new redivision of the world in line with altered relations between imperialistic forces. Such is the actual reason today for rearmaments, diplomatic convulsions and war alignments.

All attempts to represent the impending war as a clash between the ideas of democracy and fascism belong to the realm either of charlatanism or stupidity. Political forms change, capitalist appetites remain. If a fascist regime were to be established tomorrow on either side of the English Channel – and hardly anyone will dare to deny such a possibility – the Paris and London dictators would be just as little able to give up their colonial possessions as Mussolini and Hitler their colonial claims. The furious and hopeless struggle for a new division of the world follows irresistibly from the mortal crisis of the capitalist system.

Partial reforms and patchwork will do no good. Historical development has come to one of those decisive stages when only the direct intervention of the masses is able to sweep away the reactionary obstructions and lay the foundations of a new regime. Abolition of private ownership in the means of production is the first prerequisite to planned economy, i.e., the introduction of reason into the sphere of human relations, first on a national and eventually on a world scale. Once it begins, the socialist revolution will spread from country to country, with immeasurably greater force than fascism spreads today. By the example and with the aid of the advanced nations, the backward nations will also be carried away into the main stream of socialism. The thoroughly rotted customs toll-gates will fall. The contradictions which rend Europe and the entire world asunder will find their natural and peaceful solution within the framework of a Socialist United States in Europe as well as in other parts of the world. Liberated humanity will draw itself up to its full height.

Coyoacan, D.F., Mexico.
April 18, 1939