Thursday, February 25, 2010

Fundamentals of Marxism

Marxism (however right or wrong its basic assumptions are) is a huge and multifarious system that is worth understanding. Though mostly connected with "Political Economy", Marxism is not limited to that but offers a full philosophical system and world view of its own.

To understand the environment under which Marxism was formed, it helps to have a glimpse of the trends in 17th to 19th century European intellectual circles in general and trends political intelligentsia in particular. Also important is the "post French revolution" decline of Monarchy/Feudalism (the land owners) and rise of the Capitalists (the one who controls the Capital, often called the Bourgeoisie).

Socialist and communist ideas in Europe were an inevitable consequence of the social changes brought in by the industrial revolution and the rise of Capitalism. The tilt in the balance of political power in favor of the merchant class, the emergence of the Proletariat (factory worker) as a major social group, gave rise to a new set of socio-political problems.

Practical attempts to solve socio-political problems through socialism started with Robert Owen (1771-1858) in England. Most of his ideas were Utopian in nature and thus failed inevitably. Socialist ideas slowly emerged as a major feature in European intellectual circles, and gradually gave rise to a group of socialist thinkers and system builders (mostly Utopian). Some of the notable names among them are Pierre Proudhun of France; Alexander Herzen, Mikhail Bakunin of Russia,; Eugen Karl Duhring of Germany ...

Pre-Marxist socialism was mostly Utopian and impractical. Inspired by the philosophy of Willhem Hegel & Ludwig Feurbach and influenced by the emerging materialist world view of the mid 19th century (thanks to Darwin and the rise of naturalism) and backed by a rigorous analysis of history, philosophy and political economy; Marx turned the Utopian socialist ideas of his predecessors into a workable system.

If at all we can single out one principle that is most important to Marxism it is Materialism. And the two fundamental theories of Marxist ideology ends with the word "materialism":

1. Dialectical Materialism:-

Marx gave great significance to the fact that the world is always in motion and is always changing. Taking note that change is the force that drives development and progress in all spheres, and applying it specifically to the social sphere, Marx borrowed Wilhelm Hegel's (1770-1831) metaphysical concept of dialectics and gave it a materialistic interpretation

Marx agreed with Hegel on the triad of dialectical development namely thesis, anti-thesis and synthesis. A thesis is an intellectual proposition/idea/concept, will inherently imply or cause its own negation or very opposite the anti-thesis; whereas the synthesis solves the conflict/contradiction between the thesis and anti-thesis by reconciling their common truths, thus forming a new proposition. The synthesis once a proposition forms a new thesis, which in turn creates its own anti-thesis and synthesis, and so on.

Each cycle of thesis, anti-thesis, synthesis marks progresses, but the shape of the progress is never linear (always improvement) nor circular (always coming back to the starting point) but is spiral in nature. This is called "Law of negation of negation". This implies that though history does repeat itself in some way or the other, history can never be a perfect repetition and there is always some new ground be broken and real progress being made.

Marx disagree with Hegel on a vital aspect. For Hegel the driving force for progress was always ideas, whereas for Marx its the Material (particularly the means of economic production) that determines the progress.

2. Historical Materialism:-

This principle could be considered as the core of Marxist ideology. The main points are as follows:
  • The "means of production" or the way humans work on nature to make their subsistence is the basis of human society and social relations.
  • Labor is the force that enables humans to exploit nature for subsistence.
  • Under favorable circumstances, property ownership and division of labor allows some people in society to live on the labor of others.
  • The level of development of the productive forces determines the "mode of production".
  • For a given mode of production based on what factors of production are dominant, there will be a dominant class who will control and exploit other classes in society.
  • Society progresses dialectically in stages wherein each dominant class is replaced by another in successive epochs based on the mode of production. The "mode of production" which determines the dominant class is the basis /foundation of human society. The basis in turn gives rise to superstructures like religion, culture, arts, etc. Both the basis and superstructure in a given epoch in history, reflects the interests of the dominant class of that period.
  • Class divisions and domination of a particular class, inevitably leads to class struggles.
  • Every dominant class has a tendency to bring in its own downfall partially due to its own inner contradictions, and mainly due to the changing "modes of production"
  • When the domination class becomes sufficiently weak, a new class overthrows it and makes self the new dominant class.
  • Any society with class divisions inevitably leads to class conflicts and is unstable. So was the case for feudalism & monarchy; and so will be the case for capitalism which manufactures own contradiction by creating a large working class population (proletariat) whose interests are in conflict with that of the capitalists.
  • Scientific socialism/communism being classless (only workers) is the only stable social structure. All social systems will inevitably lead to a classless society and communism.

Marx's Analysis of Capital:

"Dialectical Materialism" and "Historical Materialism" forms the intellectual and philosophical basis of Marxism. But the well known work of Marx Das Capital, has very less to do with philosophy but deals more with a rigorous analysis of Capital and its consequences, and is an economic theory based on Marxist philosophical ideas.

Marx starts Capital with an analysis of "Commodity Production and Consumption", which is the cheif economic activity in a capitalist society. Following earlier economists, Marx introduces two concepts "Use Value" and "Exchange Value". "Use Value" determines the usefulness of an item to a person or group, whereas "Exchange Value" determines the price a person or group is willing to pay for an item/commodity. The "Use Value" for breathing air is infinite for human beings, but its "Exchange Value" is zero, as its freely available for everyone. Similarly, the "Use Value" of diamonds for humans is negligible but their "Exchange Value" is high due to their scarcity.

Commodities are produced under capitalism using the "basic factors of production" namely Land, Labor, Capital, and Organization/Management. Profit is the driving factor for capitalist production. In a typical capitalist production process, factors of production having a monetary value of M1 undergoes production process to produce a commodity having a monetary value of M2. And under normal conditions of profit M2 - M1 > zero = surplus value / profit.

Borrowing Labor Theory of Value (LTV) of earlier economists, Marx agrees that the source of surplus value or profit is nothing but human labor. But Marx differs from most of his predecessors in claiming that the surplus value is not due to some creative power of labor but due to the fact that labor is underpaid by the capitalist. The capitalist never pays the laborer in full. In short, the exploitation of the laborer is the source of the capitalist's profit. And the capitalist is able to exploit the laborer because the capitalist through his control of Capital controls/owns the "means of production" that includes the raw materials, factory, machinery, control of management, etc.

Under capitalist system, private ownership of property inevitably leads to the control of Capital by a minority, which in turn leads to the exploitation of the working class. Hence, Marx concludes that "private property" the the main evil in Capitalism.

Law of diminishing profits
Critics of Marx

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