The Communist Manifesto Hits 160

This year marks the 160th anniversary of the Communist Manifesto and capitalism, aka “free enterprise,” seems willing to observe the occasion by dropping dead. On Monday night, some pundits were warning that the ATMs might run dry and hinting that the only safe investment left is canned beans. Apocalypse or extortion? No one seems to know, though the populist part of the populace has been leaning toward the latter. An email whipping around the web this morning has the subject line “Sign on Wall St. yesterday,” and shows a hand-lettered cardboard sign saying, “JUMP! You Fuckers!”

The Manifesto makes for quaint reading today. All that talk about “production,” for example: Did they actually make things in those days? Did the proletariat really slave away in factories instead of call centers? But on one point Marx and Engels proved right: Within capitalist societies, or at least the kind of wildly unregulated capitalism America has had, the rich got richer, the workers got poorer, and the erstwhile middle class has been sliding toward ruin. The last two outcomes are what Marx called “immiseration,” which, in translation, is the process you’re undergoing when you have cancer and no health insurance or a mortgage payment due and no paycheck coming in.

Marx predicted that capitalism would fall in a spirited, pro-active, fashion: The workers, fed up with immiseration, would revolt, seize the “means of production,” and insist on running the show themselves, that being the original, pre-Soviet, notion of socialism. The revolution didn’t happen, of course, at least not here. For the last several years, American workers have sweetly acquiesced to declining wages, rising prices, speed-ups at work, disappearing pensions, and increasingly threadbare health insurance. While CEO pay escalated to the 8-figure range and above, so-called ordinary Americans took on second jobs and crowded into multi-generational households with uncomfortably long waits for the bathroom.

But all this immiseration – combined with fabulous enrichment at the top – did end up destabilizing the capitalist system, if only because , in the last few years, America’s substitute for decent wages has been easy credit. Until about a year ago, we got almost daily messages, by telemarketer and by mail, urging us to consolidate our debts, refinance our homes, transfer our debts from credit card to another, and try tasty new mortgages that didn’t even require a down payment. All too often, we bit. It sounded so reasonable, for example, not to let our assets just “sit” in our houses but to start spending that money now.

At the other, Lear jet, end of the economic spectrum, there was the problem of what to do with too much money. Yes, this can be a problem. Some of the super-rich have to hire consultants to help them spend their money: Where do you get a $20,000 bottle of wine or find a Picasso for the bathroom wall? More seriously, there was the problem of what to invest in. As Chuck Collins of the Working Group on Extreme Inequality has pointed out, huge concentrations of wealth can function like rogue waves, smashing around recklessly in their search for ever higher returns. A lot of these money waves flowed, directly or indirectly, into the dodgy credit schemes that were engulfing the un-rich majority, leaving even the fat cats imperiled by the toxic debts of the subprime class.

Marx’s argument was that the coexistence of great wealth for the few and growing poverty for the many is not only morally objectionable, it’s also inherently unstable. He may have been wrong about the reasons for the instability, but no one can any longer deny it’s there. When the greed of the rich collided with the needs of the poor – for a home, for example – the result was a global credit meltdown.

Obviously, the way to address the crisis is to deal with the poverty and inequality that led to it: bail out people facing foreclosures, increase food stamp allotments, extent unemployment insurance, and, make a massive job-generating, public investment in infrastructure, and, since medical debts are the number one cause of personal bankruptcy, enact universal health insurance immediately. But not even Obama, whose lawn sign I still proudly display, seems to have the stomach for such a “trickle upwards” approach. He has announced that he won’t bother taking the bail-out as an opportunity to change the bankruptcy law so that people facing foreclosure can renegotiate their mortgages.

So happy birthday, Communist Manifesto – although I’m hoping that capitalism survives this one, if only because there’s no alternative ready at hand. At the very least, we should get some regulation and serious oversight out of any bail-out deal, meaning that, yes, the economy will look a little less like “free enterprise.” But one thing we should have learned in the last week, if not the last year, is that, when applied to enterprise, “freedom” can be just another word for someone else’s pain.
 

Comments

[Danny Boy]

Amen. Maybe it's not to late to pull my money out of Wells Fargo (before they steal it) and get the hell out of this country. Screw capitalism.

[Property Listing]

Manifesto opens with the warmth of basil, undescored by incisive pepper and citrus essences. http://realestate.blogtells.com/2008/09/15/property-listing-how-to-search-for-your-dream-home/

[CJ]

"But not even Obama, whose lawn sign I still proudly display, seems to have the stomach for such a “trickle upwards” approach."

Just because the alternative is untenable doesn't make Obama a candidate in whom pride should be taken. I wouldn't expect Mr. equivocation to demonstrate leadership on this, or anything else, any time soon.

[roger]

" 10 Planks of the Communist Manifesto

1. Abolition of property in land and application of all rents of land to public purposes.
2. A heavy progressive or graduated income tax.
3. Abolition of all right of inheritance.
4. Confiscation of the property of all emigrants and rebels.
5. Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly.
6. Centralization of the means of communication and transport in the hands of the State.
7. Extension of factories and instruments of production owned by the State; the bringing into cultivation of waste-lands, and the improvement of the soil generally in accordance with a common plan.
8. Equal liability of all to labour. Establishment of industrial armies, especially for agriculture.
9. Combination of agriculture with manufacturing industries; gradual abolition of the distinction between town and country, by a more equable distribution of the population over the country.
10. Free education for all children in public schools. Abolition of children's factory labour in its present form. Combination of education with industrial production, &c., &c.[4]

http://www.anu.edu.au/polsci/marx/classics/manifesto.html

i would be curious to know what you find attractive here.

[roger]

http://en.wikipedia.org/wiki/The_Black_Book_of_Communism

" The introduction, by editor Stéphane Courtois, asserts that "...Communist regimes...turned mass crime into a full-blown system of government". Using unofficial estimates he cites a death toll which totals 94 million, not counting the "excess deaths" (decrease of the population due to lower than the expected birth rate). The breakdown of the number of deaths given by Courtois is as follows:

20 million in the Soviet Union
65 million in the People's Republic of China
1 million in Vietnam
2 million in North Korea
2 million in Cambodia
1 million in the Communist states of Eastern Europe
150,000 in Latin America
1.7 million in Africa
1.5 million in Afghanistan
10,000 deaths "resulting from actions of the international communist movement and communist parties not in power."(p. 4)

lets assume that global communism takes only half of the lives which the authors here claim. what is it specifically and analytically which you find attractive here?

[Xaque]

Barbara,

I have very little room to critique much of your work. Your book “Nickel and Dimed…” still stands as a great social commentary reminiscent of Orwell’s prison experience, and I applaud your courage and conviction.

Despite my limitations as a literary critique, on a more inductive and scientific grounds I think a legitimate criticism ought to be made on your most recent article in the Nation. In short, I think most of your economic theory is bogus. If you weren’t already aware, no Marxian or social economist, who is still right, has ever received a Nobel. On the other hand free marketers like Freidman, Hayek, and others continually thanked for the great success of capitalism, liberty, and so on while also being granted Nobels, departments, and halls across academia. I’m sure I’m merely repeating the same old rebuttal you probably expected, and it seems you’ve intentionally ignored the the aforementioned tradition.

Den of thieves that it is, the Nation does make some room, as you demonstrate, for honest discourse. Why not, let’s be honest, admit that the very institution you want to rely on for a ‘little’ change is the same that got us into this mess, by your argument. In other words the government that is supposed to ‘address the crisis is to… bail out... increase… extend… and make a massive… public investment” ('little' in deed) is also the one that was so myopic as to not be able to predict the need for these protractions in the first place. Is that what you are saying? Rely on the body of power that has demonstrated in more than a thousand ways, from a thousand directions, that it can’t finitely or broadly control most of our problems? What is the private sector, chopped liver?

To be terse I’ll make one more point. You say Marx predicted the increased separation between the upper and lower classes, the fall of an economy because of said separation, and then you conclude by saying that his reasons for believing this are independent of the actual falling event. Why is it then that you include Marx’s doctrine in the first place? In a sense you say that Marx’s predictive power is not found in the fulfillment of the logic that derived the prediction. How can his prediction be independent of his reasons for predicting? This seems to be a classic violation of Newton’s third law. An effect cannot be without a cause. The loss of economic trust comes for a reason. Not to mention the reason is to say that the solution to prevent whatever that reason implies is nonexistent. The leap you make from ‘he may have been wrong about the reasons’ to let’s use his solution is in error by definition.

Thinkers like Freidman and Schwartz work their whole lives searching for reasons to make claims about natural phenomena. To make the kinds of lofty claims you buy into without any reasons for doing so is astigmatic and depressingly false on multiple counts.

[Tim Worstall]

"But on one point Marx and Engels proved right: Within capitalist societies, or at least the kind of wildly unregulated capitalism America has had, the rich got richer, the workers got poorer,"

So, let's see. Have the poor got poorer since 1848?

Umm, you know, I rather think that they haven't. So Marx and Engels have in fact been proved entirely wrong, have they not?

[Chickensh*tEagle]

Xaque: "How can his prediction be independent of his reasons for predicting? This seems to be a classic violation of Newton’s third law."

Since Newton's laws of motion apply in the world of physics, a violation would have to involve some anomaly seen in the physical world -- such as a rocket traveling in the same direction as its exhaust instead of the opposite one -- not inside somebody's head.

Or, acknowledging that you might have been speaking metaphorically, what have Marx's "predictions and reasons for predicting" to do with action and reaction?

"Thinkers like Freidman and Schwartz work their whole lives searching for reasons to make claims about natural phenomena."

But didn't find any, and decided to make claims about economic phenomena instead, for one very good reason -- it pays better.

[Danny Boy]

Tim- Actually, if you count inflation rates (inlcuding cost-of-living), the poor of 1848 were financial gods compared to the poor 2008.
Xaque-The flaw in your argument is that the goverment got us into this mess. It was actually Big Business, which controls the government thanks to a weak constitution that fails to address multinational corporations. So in fact, Barbara is right about the government's potential to fix the problem through socialism. And nobel prizes? Give me a break. I'm a science major, and Nobel prizes are often given away for things later shown to be in error. Prime example: Al Gore. Please spare us nobel prize arguments, as they are absolutely meaningless in scientific reality.

[roger]

" So in fact, Barbara is right about the government's potential to fix the problem through socialism. "

well go ahead.

enlighten us about how socialism can deliver as well or better than capitalism that which marx insisted was essential for throwing off the yoke of their masters: shelter, clothing and food.

i might suggest some reading: http://books.google.com/books?id=_vTLJpWj-0wC&dq=the+man+who+stayed+behind&pg=PP1&ots=Gtq-iiOYDL&sig=YdztvILHkP5reGNb6sGBrqMWEAQ&hl=en&sa=X&oi=book_result&resnum=4&ct=result

the experiment failed in spectacular fashion.

[roger]

" The Great Leap Forward is now widely seen – both within China and outside – as a major economic failure and great humanitarian disaster with estimates of the number of people who starved to death during this period ranging from 14 to 43 million. "

http://en.wikipedia.org/wiki/Great_Leap_Forward

[potlatch]

"enlighten us about how socialism can deliver as well or better than capitalism that which marx insisted was essential for throwing off the yoke of their masters: shelter, clothing and food."

Let's talk figures. When state interventionist policies were dominant, global growth averaged 3.5% in the 1960s and 2.4% in the 1970s. When neoliberal policies were in ascendence, average global growth was 1.4% in the 1980s and 1.1% in the 1990s. Now we are in full-blown crisis. Neoliberalism, and financialisation, did nothing to solve the fundamental problems in the real capitalist economy.

Now we're left with a gaping wound, a hole revealing the underlying cause of this crisis of capitalism. And no apparent solution in sight except more of the same.

[jack]

Let's home we have another civil war before property and the right of inheritance are abolished. It's a philosophy for weaklings and derelicts. Yes, I know, these leftist loons are soiling themselves with glee over the financial market debacle, hoping beyond hope that the "wildly under-regulated" collapses, vindicating them. But it aint gonna happen. Americans might vote for the nationalization of certain chunks of the financial markets out of temporary necessity, but don't think we've turned the corner into some communist shangri-la. We haven't. Why? Because Americans simply don't like their paychecks confiscated and given to derelicts.

[Teo]

Maybe this will help:

www.monthlyreview.org/0906ball.htm

Happy birthday, Communist Manifesto!

[Jr]

Barbara - At least some of the blame for the current economic mess belongs to the borrowers. We must get back to a society where personal responsibility and prudent decision making is rewarded. Bailing out greedy homeowners is almost as bad as bailing out greedy wall streeters. Lots of homeowners have been drunk on easy credit for many years, and now that the party is over, they must sober up. Capitalism is not perfect, and neither is Communism. The right balance is located between the two. More aggressively taxing the wealthy would be a good start. For some reason, this country worships Warren Buffett, while he continues to build wealth at their expense.

[dan keefe]

Dear Barbara, I'm dancing in the streets...now we can get on with the on-going reformation !

[Brian]

If the next administration simply solves 4 things, universal health insurance, funding social security, medicare, and medicaid, sets up an apparatus to drop the mortgage interest rates 1 percent for those that would have qualified under fannie mae, add's money market insurance for the first 100,000 dollars and 250,000 for bank deposits, regulates wallstreet and the banks like its supposed to, gets us out of Iraq, starts an infrastructure rebuilding plan including restarting the Youth Consrevation Corps with expanded trades job training to give them alternatives to sitting in cubicles, and to include people who are older as well, assist and fund the startup of green industries, increased auto milage to 45 miles per gallon, funds more pilot projects in solar, wind, geothermal, and natural gas, pilots designs of new generation safe nuclear plants for later construction, distributes new led lighting technology, gives tax breaks on hybrid and alternative fuel cars and assists with building out a hub of electric and hydrogen feuling stations in cities and highways(have to start somewhere), reduces the prison population by diverting nonviolent prisoners into other types of programs, focus the war on drugs on dealers and merchangts of violence rather than our citizens driving their cars, and finds creative ways to reduce college and trade school tuitions in exchange for 2 year tours of community service or the military, we could really turn this country around, and changes the mindset of the nation into more an engineering to solve problems one rather than a legal and financial one, we could really turn the nation around. I don't think any of it directly challenges corporations, but rather nudges and focuses them into new strategies for survival as well as bringing on the talent of our people. This should allow political passage if we can redo our tax and spending structure, but still within some tolerable bounds. We have the tools, but they are strewn all over the floor and we simply need to reorganize ourselves around productive ventures again. Its not just some big government doing everything, but a government that helps organize and focus us where in many ways we and the private sector will make it work. It will take some real leadership in congress to get them coherent even with a good administration. I would suggest a strong grass roots push up to infrom the political structure that this is what we want and we mean business. This past weeks House of Reps vote down due to popular demand is a good example of what people can do. Instead of 70 percent lawyers in congress I would rather see more engineers, scientists, public administrators with experience, teachers, and other types of talent in our society at the helm.

[Danny Boy]

Jack-Derelicts? You mean those Billionaires who do no work for their money, which is taken from the hard labor of others?
Roger- You might want to take a sociology class before you start talking sociology. In fact, Europe consists of mostly socialist countries (usually with some form of democratic or constitutional government), most of which are more wealthy than the U.S. Those countries also have less poverty, less homelessness, less crime, higher houshold incomes, and less inequality. I would do the homework before standing up for our clearly failing economic system.

[racetoinfinty]

Roger - It seems you only read the title of this post, and it pushed your Ayn Rand buttons and you went to work with your anti-communist talking points. Barbara is not advocating communism. She's advocating an FDR type liberal recovery, essentially. Read the article before you "go off".

[Brian]

There is a school of thought that an FDR type of recovery from the great depression didn't happen. Instead what happened is world war 11. For years before we entered the war we ramped up manufacturing and shipped war material overseas big time, then we amped up our own. We pushed men into low paid military jobs and women at lower wages into the civilian workforce makeing labor far more productive. Then after thw war we in many ways rebuilt the developed world for the times and this was immensely profitable as they became our biggest customers. FDR, social security, the youth conservation corps, the fancy trades work, probably did little to really turn our economy around, but it did help give hope, new skills, and some sembalance of security to the peopple. But it was WW 11 that really got us out of the great depression.

[Diane]

'Socialism''is no more an evil word than ''Christianity.'' Socialism no more prescribed Joseph Stalin and his secret police and shuttered churches than Christianity prescribed the Spanish Inquisition. Christianity and socialism alike, in fact, prescribe a society dedicated to the proposition that all men, women and children are created equal, and shalt not starve.

Adolf Hitler, incidentally, was a two-fer. He named his party the National Socialists, the Nazis. Hitler also had crosses painted on his tanks and airplanes. The swastika wasn’t a pagan symbol, as so many people believe. It was a working person’s Christian cross, made of axes, of tools.

About Stalin’s shuttered churches, and those in China today: Such suppression of religion was supposedly justified by Karl Marx’s statement that that ''religion is the opium of the people.'' Marx said that back in 1844, when opium and opium derivatives were the only effective painkillers anyone could take. Marx himself had taken them. He was grateful for the temporary relief they had given him. He was simply noticing, and surely not condemning, the fact that religion could also be comforting to those in economic or social distress. It was a casual truism, not a dictum.

When Marx wrote those words, by the way, we hadn’t even freed our slaves yet. Whom do you imagine was more pleasing in the eyes of a merciful God back then: Karl Marx or the United States of America?

Stalin was happy to take Marx’s truism as a decree, and Chinese tyrants as well, since it seemingly empowered them to put preachers out of business who might speak ill of them or their goals.

The statement has also entitled many in this country to say that socialists are anti-religion, are anti-God, and therefore absolutely loathsome. - Kurt Vonnegut

[Brian]

I wonder if anyone ever researched the bank accounts and wealth amassed by the top tier players in Hitlers regieme, including himself. Did they steal money too, or appropriate it in a mass scale into personal fortunes, or did the state just assign them all the help, houses, and perks they reauested? Some of hitlers generals stole art and gold of course but its unclear if that became their personal fortune or they were just "temporary caretakers" of the loot. Or did the nazi government police its own and forbid the accumulation of "the states" winnings for personal gain? How did they even pay all their domestic and administrative help? Its really unclear how the nazi system distributed money. Without understanding the real nuts and bolts of simple things like money between nazi's we are more likely to not recognize it when it comes back again. A Financial Study of the Third Reich, would be an interesting read.

[forrest curo]

There actually are some post-Copernican economists who saw all this coming while the Chicago School orthodox was selling our legislators an economic policy that benefited one swollen sector of the economy at the expense of everything real! In the spirit of your wonderful analyses of what happened to the culture over the last half-century, there's a rogue Wall Street financial economist, Michael Hudson who can give a pretty good background on the technical aspects of why:
please see
http://www.michael-hudson.com/articles/debt/0406SavingInflationDeflation.html

The basic prediction goes back to Hyman Minsky in 1987, but Hudson makes a lot of sense of why the real economy got drowned in fluff!

[Brian]

Thanks, reading Hudson made me realize that before the current wallstreet crash, the orthodoxy that the free market knows best was so strong you couldn't take his paper seriously, but now you can. WE do need to rethink our basis of economical theory once again. If speculative bubbles confiscate wealth from going into tangible production they are inhibitors to growth. The finanical world made its own hyperbolic economy and while it lured so many of us into big debt, it really didn't rebuild our aging infrastructure, revamp our health care system, improve our public schools, fix our pot holes real good this time, secure stable retirements, but instead siphoned off this money into the hands that controlled the tools of the speculative bubble. The 100 million dollar pay packages that went to ceo's, etc, was simply the confiscated wealth of the rest of the country in this new scheme. I still don't know why people aren't simply outraged at the government for not regulating this as it went on and on. While I don't think America is about to fall, I think it will profoundly rethink its blind alliegence to private enterprise and the star game. Already other nations are mocking us for stumbling regardless of their own internal imbroligios. Wallstreet impaired our national security.

[MaineArt]

This discussion is so refreshing! Thank you.