Why Study Marx? or Marxian Anti-Economics and the Study of Political Economy

From the ruins of the Berlin Wall and the decline of the Soviet empire emerged declarations about the end of Marxism and the triumph of Western capitalist democracy. And yet, these misguided assertions failed to address two key points - that Soviet-style top-down communism was not what Karl Marx envisioned in his writings, and that Marxism contained more than simple rhetoric about revolutionary struggle, it was also a meticulous economic analysis of capitalist society and the socio-political consequences of such a system.¹ It is this second aspect of Marxism that will be addressed in this essay.

Why Marx?

Some students of political economy may contend that other authors, such as Adam Smith, have also analyzed the capitalist mode of production. Therefore, they would ask, why study Marx in particular? The answer lies in the argument of this essay: Marxism is not simply another form of economics, but the antithesis of economics. Marx’s critical perspective on the nature of the economic system turned the world on its head and continues to have an enormous impact. In the Hegelian sense, Marx initiated the dialectic of economics (classical political economy) against Marxism, which has partially led us to where we are today. The first section of this essay will briefly examine the concept of dialectical materialism and how this approach was adapted by Marx and Friedrich Engels.

For those of us living in North America, we live in a capitalist economic system. Accordingly, if we are to theorize about political economy, it is important to understand how our economic system functions (in the broad, abstract sense), or fails to function, and the mechanisms used in the drive for the accumulation of capital. It is also essential to understand why the nature of the system we live in is that of perpetual economic growth. As such, the second section of this essay focuses on Marx’s theory of surplus value, his general formula for capitalism and how it differs from previous eras.

The increasing commercialization and privatization that we witness on a daily basis² possess within them contradictions that are symptomatic of systemic crises in the socio-economic sphere. Alienation and dualities, such as freedom/unfreedom, wealth/poverty, and power/powerlessness, are prevalent throughout capitalism. Making sense of these contradictions requires understanding concepts of labour, labour-power, and class while also considering the political consequences of such paradoxes. An analysis of class is necessary in order to deliberate on whether the capitalist economy belongs to any particular group, and what this may mean for Marx’s concept of class struggle. The third section of this essay addresses these issues, examining notions of abstract labour and thoughts on future methods of societal transformation.

Finally, reflection on the critiques of Marxism is necessary in order to understand the limitations of Marx’s analysis and to recognize possible fields of further inquiry. This fourth section will examine some of these critiques and attempt to explain why Marx’s proletarian revolution has yet to be realized.

Historical/Dialectical Materialism

Engels named the approach “dialectical materialism” because it incorporated Hegel’s idea of inherent change, at the same time grounding itself in the social and physical environment.³ For Marx and Engels, production would always be the basis for every social order. As such, they contended that the causes of all socio-political changes and revolutions would be found not in philosophy, but in the economic organization of that particular period of analysis.⁴ Historical materialism, the materialist conception of history, is the name given to Marx’s methodology in the study of society, economics and history.

Within every society exists a base and a superstructure. Within the capitalist system, the base is industrial production, while the superstructure is private property. For Marx and Engels, these two elements of capitalism were incompatible with each other - industrial production was becoming an increasingly interdependent process, while private property was the most individualistic of social systems.⁵ The clash between the base and superstructure meant that capitalism would eventually destroy itself while also providing the seeds for its own successor. This idea will be revisited in the third portion of this essay.

An understanding of historical materialist methodology is imperative because of its influence on other theories and analyses of political economy, including those of V.I. Lenin, Rosa Luxemburg, and Eric Hobsbawm. The impact of historical materialism has been felt by a number of other authors such as Antonio Gramsci, Louis Althusser and Georg Lukács. Robert Heilbroner has put it eloquently, stating that Marx’s ideas have been felt throughout the realm of social thought, and that all who wish to explore this realm, “whether or not they agree with Marx’s findings, must pay their respects to the person who first claimed it for [hu]mankind.”⁶

Formulating a Theory of Capital and Surplus-Value

Prior to a discussion of capital and surplus value, it is important to elaborate on the differing variations in Marx’s meaning of value. First, use-value is the utility of a thing, and independent of the amount of labour required to create it, only becoming a reality when used or consumed.⁷ Second, exchange-value is the value of a thing in relation to other things. Once that thing enters into circulation as a commodity (defined as “an object outside us, a thing that by its properties satisfies human wants of some sort or another”⁴), it possesses exchange-value. For Marx, exchange-values are abstracted from their use-values, and can only be reduced to the amount of labour applied in its creation.⁸

Marx’s general formula for capital begins by stating that “[t]he circulation of commodities is the starting-point of capital.”⁹ This circulation eventually ends (and begins again) in the form of money and it is in this final form that capitalism differs from other modes of economic activity. In traditional economies, the formula for economic activity is C-M-C, which entails selling something in order to buy something else. However, it capitalist economies, the formula is expressed as M-C-M, or buying in order to sell. This is the general formula for capital, in which the circulation of money as capital is an end in itself, for “the expansion of value takes place only within this constantly renewed movement … [and] the circulation of capital has therefore no limits.”¹⁰ Neither use-value nor profit from any single transaction is the objective of the capitalist. Rather, the capitalist aims for the “relentless never-ending process of profit-making.”⁴

On the production of surplus-value, Marx demonstrates that the capitalist can sell a product at its actual value and still profit from the transaction. Generally, we can say that the capitalist pays the worker a subsistence wage (a wage that allows the worker to continue producing and reproducing), but that subsistence wage is less than the amount of labour the worker puts it. As such, surplus-value comes from the unpaid labour that worker performs. The worker is entitled only to the value of his labour-power, which he receives in full, but the capitalist acquires the full value of the worker’s entire working day (which is longer than the hours for which he paid). Thus, the capitalist can sell his products at their true value and still realize a profit.¹¹

Abstract Labour, Class and the Dual Nature of Freedom

Abstract labour is a necessary concept originating from Marx in his analysis of the capitalist economic system (as well as for the oncoming proletarian revolution). While authors such as David Ricardo have attempted to account for the different prices and manifestations of labour through comparative analysis, Marx sought to find a common denominator of value. Marx argued that capitalism creates a particular type of labour - abstract labour - in which labour-power is a commodity in itself.¹² Although not without its flaws, abstract labour remains an effective method of linking all products and forms of labour. While the labourer produces different things for every given capitalist, this does not alter the general character of that production. Thus Marx considered the labour-process independently of the particular form it assumed under given social conditions.¹³ As such, the most crucial aspect of the “labour theory of value” is not the determination of prices, but the “identification of a kind of social system in which labour-power becomes a commodity.”¹⁴

The idea of abstract labour is a fundamental component of both Marxian critical economics and Marxist revolutionary struggle. Abstract labour’s importance in the former lies in Marx’s analysis of value, which is defined by the labour-time necessary for the production and reproduction of the product. By treating labour-power as a commodity, as something to be bought and sold on the market, workers are alienated from their labour in that they do not control or own what they create. As such, the “existence of commodities, and the value-relation between the products of labour which stamps them as commodities, have absolutely no connexion with their physical properties and with the material relations arising therefrom.”¹⁵

Abstract labour is also of importance to Marxist class analysis, in which the proletariat’s labour-power is exploited by the bourgeoisie capitalists. For Marx, “the history of all hitherto existing society is the history of class struggles,”¹⁶ suggesting that all of history is defined by the relation to the means of production and the conflict that it generates. Because encounters between classes drive history, we become aware of ourselves when we encounter another class, and abstract labour is a key component that binds the proletariat into a single revolutionary force. When capitalist society tears something away from one worker, it effectively exploits all workers, who have their labour-power in common. Because capitalism understands everything in terms of economic value, differences in the proletariat disappear and all that is left are the proletariat and the bourgeoisie. “All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses, his real conditions of life, and his relations with his kind.”¹⁷ For Marx, the increasing centralization of the means of production and the socialization of labour would eventually reach a point where they would become completely incompatible with their capitalist integument, whence the “integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.”¹⁸

From the manifestation of labour-power as a commodity comes Marx’s dual notion of freedom - that is freedom/unfreedom. The worker is free, in that she or he can dispose of her labour-power as her own commodity. However, she has no other commodity for sale, and does not possess everything necessary for the realization of her labour-power.¹⁹ As such, the worker possesses individual freedom, but this freedom is subject to structural constraints. These types of dualities are an essential part of historical materialism and analyses of capitalist society. In the view of some authors,²⁰ historical materialism suggests that capitalism is simultaneously exploitative and progressive, creating both wealth and poverty, and bringing into being forms of power and powerlessness. Students of political economy should be aware of these dualities and the ways in which they manifest themselves.

Where To Go From Here: Critiques and Fields of Further Inquiry

While the study of Marx’s work is essential to students of political economy, Marxism is not without is limitations and potential flaws. An important question is the matter of where the motivation for profit originates. This is perhaps one of Marxism’s greatest strengths - in that it allows for a critical analysis of the economic system as it exists - and one of its most significant limitations. Are authors such as Adam Smith correct in their advocacy of profit and trade as natural human behaviour? Heilbroner makes the additional argument that Marx’s world is built on labour value, without showing that the world of dollars and cents, the world we live in, mirrors the abstract world he created. While Heilbroner argues that this mistake is not intractable, as we may be able to “explain a correspondence between the price that really obtains in real life and the underlying values in terms of labour-time,” there still remains the problem of objects with natural use-value. Do these objects have no value because no labour was involved in their creation? Finally, the question of human agency must be addressed in relation to structure when we analyze classes and class struggle.

Many have dismissed Marxism on the basis that capitalism is still around, proving the adaptability of the capitalist mode of production, to the general satisfaction of the working classes (at least to the effect that systemic revolution has not taken place). However, to focus on the revolutionary Marx is to ignore the piercing, critical analysis of the economic Marx. The Marxian critique of classical political economy has been felt throughout the social sciences and students of political economy would be well advised to not dismiss one of the greatest minds in social, political and economic thought.

Bibliography

Heilbroner, Robert (1996). Teachings from the Worldly Philosophy. New York: W.W. Norton.

Heilbroner, Robert (1980). The Worldly Philosophers. New York: Simon & Schuster.

Marx, Karl and Frederick Engels (1968). Selected Works in One Volume. Moscow: Progress.

Marx, Karl and Friedrich Engels (2002). The Communist Manifesto. Toronto: Penguin Books.

Rupert, Mark and M. Scott Solomon (2006). Globalization and International Political Economy: The Politics of Alternative Futures. Oxford: Rowman and Littlefield.

Sears, Alan (1999). “The ‘Lean’ State and Capitalist Restructuring: Towards a Theoretical Account.” Studies in Political Economy 59, p. 91-114.

Notes:

1. This essay will distinguish between the revolutionary Marx (Marxist) and the critical economist Marx (Marxian), while using the term Marxism to embody both personalities. [↩]
2. For example, see Alan Sears, “The ‘Lean’ State and Capitalist Restructuring: Towards a Theoretical Account,” Studies in Political Economy 59 (Summer 1999), p. 91-114. [↩]
3. Robert Heilbroner, The Worldly Philosophers, New York: Simon & Schuster, 1980, p. 141. [↩]
4. Ibid. [↩] [↩] [↩]
5. Ibid, p. 144. [↩]
6. Ibid., p. 167. [↩]
7. Robert Heilbroner, Teachings from the Worldly Philosophy, New York: W.W. Norton, 1996, p. 162. [↩]
8. Karl Marx and Frederick Engels, Selected Works in One Volume, Moscow: Progress, 1968, p. 201. [↩]
9. Ibid, supranote 7 at 167. [↩]
10. Ibid, p. 168. [↩]
11. Ibid, supranote 3 at 154-155 and Ibid, supranote 8 at 205-206. [↩]
12. Ibid, supranote 8 at 201-202; also important to note is the difference between labour and labour-power. Labour is a quantity, while labour-power is the capacity to work. While the value of a product may be measured in the amount of labour, or labour-time, requires for its manufacture, labour-power is a commodity whose use-value possesses the peculiar property of being a source of value. [↩]
13. Ibid, supranote 7 at 175-176. [↩]
14. Ibid, supranote 3 at 160-161. [↩]
15. Ibid, supranote 7 at 166. [↩]
16. Karl Marx and Friedrich Engels, The Communist Manifesto, Toronto: Penguin Books, 2002, p. 219. [↩]
17. Ibid, p. 223. [↩]
18. Ibid, supranote 7 at 191. [↩]
19. Ibid, supranote 7 at 171. [↩]
20. For example, see Mark Rupert and M. Scott Solomon, Globalization and International Political Economy: The Politics of Alternative Futures, Oxford: Rowman and Littlefield, 2006. [↩]

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