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August 27, 2006

Marxism For Fools

Brad Delong with a highly entertaining demolition of the basis of Marxism.

If you try to ground an analysis of capitalism-in-particular on a feature (the distinction between objects' direct usefulness and their role in social processes of reciprocity, redistribution, or market exchange) that capitalism shares with every other human social system--well, you won't get anywhere. And those who read Capital "in a group, out loud, line by line, paragraph by paragraph... discussing and arguing over every page, through volumes one, two and three, even unto Theories of Surplus Value" don't get anywhere at all.

’Tis foolishness, the entire theory.

(Note D2 defending Marxism in the comments.)

August 27, 2006 in Economics | Permalink


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Marx's notion of class conflict is founded on his naive insight that buyers in a market transaction would prefer to buy at lower prices while sellers would prefer higher prices and that markets are a means of resolving these conflicting preferences. Unravelled, Communism is a hypothetical state where such preference conflicts have been simply abolished in a context which is never elaborated. Put like that, it all seems rather silly which is what it is.

One of the earliest legal codes - that of Hammurabi in 18th century Babylon - includes elements about property rights, commercial law and an attempt at a rudimentary statutory prices and incomes policy, presumably to abate what might otherwise have become destabilising social frictions at the time. There is an implicit recognition of the social value of markets and provisions to enable markets to function more efficiently.

The notion that groups of capitalists and workers each have common interests is also rather silly. Other software developers are among Microsoft's most contentious antagonists and competitors. As for workers, remember the Sheffield outrages of 1866 when some employers and workers who opposed policies of the cutlery union were blown up to dispose of opposition. That led to the appointment of the justly famous Royal Commission on Trade Unions in 1867, by a Conservative government, to consider whether trades unions were potentially valuable labour market institutions or inherently disruptive organisations with potential criminal intent:

To consider all aspects of the relating issues with open minds and access to all relevant information, immunity from prosecution was promised to all those implicated in the Sheffield outrages. So much for the popular notion of the Victorians being dedicated to smashing the trade unions in order to better grind the poor.

With due credit to Marx, according to Engles' preface in 1886 to the English edition of Capital:

"Surely, at such a moment, the voice ought to be heard of a man whose whole theory is the result of a lifelong study of the economic history and condition of England, and whom that study led to the conclusion that, at least in Europe, England is the only country where the inevitable social revolution might be effected entirely by peaceful and legal means. He certainly never forgot to add that he hardly expected the English ruling classes to submit, without a 'pro-slavery rebellion,' to this peaceful and legal revolution."

But then, according to Francis Wheen's recent biographical study of Marx, Bakunin, a contemporary Russian anarchist, reckoned that Marx served as a police spy on radical groups. Wheen assesses that Bakunin's belief was likely true.

Posted by: Bob B | Aug 27, 2006 12:55:47 PM