Declining capitalism

On the 150th anniversary of the publication of the Communist Manifesto: Hillel Ticktin, editor of Critique

The Communist manifesto was one of the few works which was actually published during Marx's lifetime. Marx writes of the development of capitalism, its death and the coming into being of the future. Taking from Hegel, Marx understands how something comes into being. It matures, it develops, it declines, it dies and it is superseded. That is the way Marx understood capital in human history.

We can say that Marx is starting from the evolution of human freedom. He writes: "The history of all hitherto existing societies is the history of class struggles. 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." It is in that evolution of the form by which needs are satisfied that we understand the meaning of human history and, of course, it is the oppressor form which is overthrown time and time again.

Logically a point will eventually be arrived at where truly human history, as Marx calls it, will be reached: a time when socialism can come into being, and where the form and the content are one. Here there is a unity between the moral and the positive, between the movement of categories and the class struggle.

Engels correctly says that the Communist manifesto attempts to elaborate two things. One is historical materialism, and the other is the concept of the working class as the universal class. Historical materialism, which Marx is discussing without actually stating it, has two aspects: the movement of categories and the movement of class. Without this understanding there can only be empiricism - a series of class struggles, without any comprehension of why they take place.

There are certain Marxists who do not understand the link between the movement of categories and the movement of class, that the two must come together for history to evolve. This is particularly true, I have to say, of the Stalinist historians. They explain the movement from feudalism to capitalism in terms of the class struggle of the peasantry alone. That cannot be the case.

The coming into being of homogeneous human labour, abstract labour (not discussed in the Communist manifesto), led to the coming into being of the working class. There were three concepts explored or introduced by Marx of which in his later work he said he is most proud. These were labour-power, surplus value and abstract labour.

These three categories are absolutely crucial to Marxism itself and they are fundamental to what Marx was arguing in the Communist manifesto, although they are not specifically mentioned (apart from labour-power, which was subsequently inserted by Marx as a footnote).

The three aspects of his method, which he develops later, are also evident. First, that there is a necessary unity between morality, or ethics, and reality. They cannot be separated. Second, that Marx's method is dialectical - in other words, everything has a beginning, growth, maturity, decline, decay and supersession. That too is in the Communist manifesto, but not in direct form.

Thirdly, there is the method of abstraction. That is to say, a Marxist does not just take a series of empirical statements and arbitrarily repeat them, or go through a series of successive approximations - that is not Marxism. What a Marxist does not do is look at what exists and then gradually peel off the aspects regarded as unimportant in order eventually to reveal what is in the middle.

Marx begins with what is crucial, as he does in the Communist manifesto, where he looks at social relations. And of course he emphasised that capital is a social relation, which previously no-one had done, regarding it as purely technical. Therefore, all those relations which appear in society between capital and labour are not technical: they too are social. So those are the three aspects of his method - or three methods, if you like.

The methods of abstraction, dialectics and the close interconnection of the moral and the material. I would like to deal with the dialectical aspect here: ie, everything comes into being, matures, declines and goes out of existence. If you accept that viewpoint, then you cannot simply state that we are now in the epoch of the bourgeoisie.

Things are not quite so simple. For example, there used to be giant plants employing thousands of people, but now factories are deliberately built on a smaller scale. That is not because the work is more efficient, but because the bourgeoisie realises the power of the proletariat when it is concentrated in a single place.

There has been a deliberate decision to break up plants, even if that means production is more inefficient. That is not progress - it is a method of control. Today there is production for the few - shoddy goods for the many and luxury goods for the rich. It is no coincidence that the pharmaceutical companies do not produce the drugs required for malaria, tuberculosis or even Aids to a sufficient extent. They concentrate on those diseases that will produce the best return. Is that progress? For capital, yes, but not the sort of progress that we actually want. It is a limited progress.

Put another way, there is a huge gap between the potential and the actual development of production, and that gap is growing. The bourgeoisie delays the introduction of automation. They do not automate, they do not introduce labour-saving machinery, unless they have to.

Marx's theory of the crisis, remember, involves the argument that it is at the point when workers demand better conditions and higher wages that machinery is introduced. If workers' wages can be kept low, why introduce more machines? It is costly to do so unnecessarily. In other words, although more machinery, more automation continues to be introduced, this process could have proceeded much faster and much further than it has.

Even computerisation and the internet could have been introduced very much more quickly. Recently there were a discussion about installing fibre optic cable throughout Britain. The government refused to do it because it cost too much. This is not progress. It is not the development of the means of production. Or take transport. Clearly, overall it is not being developed. Aspects of it are, but the obvious requirements are not. The rail system is distinguished by its unpredictability - you never know when you are going to get to the other end; and that is not just true of Britain.

So the revolutionisation of production is hardly running apace. I am not saying it has stopped all over the world, but the gap between the potential and the actual is growing. It is quite clear that a more rational government, capable of overseeing society as a whole, would be able to speed up developments enormously. In other words, Lenin was right when he said we are in a phase of decline.

Unless we understand that, we do not understand the difference between what Marx wrote and what now exists. The Communist manifesto calls directly for the overthrow of capitalism by the proletariat. It does not introduce other classes except as subordinates. It does not talk about stages and there is no question of a popular front, or any kind of front.

Capitalism has to be overthrown, neat and straight. There is no question, as under Stalinism, of the necessity of alliance with other classes. The Communist manifesto talks of political alliances, but the other classes are subordinate to the proletariat. It was Stalinism which introduced stages - national liberation, and the various forms of working together with whomever it might be.

Marx insists that at all times the communists maintain the prime role of the proletariat and its need to take power. The proletariat is never subjected to any kind of inferior position. Later, in The class struggles in France, and then in Marx's Address to the Communist League in 1850, he introduces the concept of permanent revolution. Of course Stalinists refuse to recognise that such a concept even existed.

But it is not a question of it being understood from a retrospective reading of Trotsky: it is very much there. Marx says: "The February revolution of 1848 can only become permanent when the proletariat takes power from the petty bourgeoisie."

There can be a series of steps in a revolution, as there was in 1848: the aristocracy was overthrown and the petty bourgeoisie came to power; the proletariat tried to take power, but failed. It is only the last step which will make the revolution permanent. To use Marx's words from his inaugural address in 1864, only the working class - the class which is in capitalism, but not of capitalism - can emancipate all mankind, which it does by emancipating itself.

The peasantry cannot do that: it can only act as a problem. In the Communist manifesto Marx sees the peasantry as a reactionary force. One cannot get away from it: he says it in those words. That is why Lenin's concept of a 'democratic dictatorship of the proletariat and the peasantry' does not make any sense.

I understand why he said it - he was trying to compromise - but it was simply a nonsense in Marxist terms. The point to stress again is that Marx sees the proletariat, and only the proletariat, taking power, because it stands for all mankind, and only it is the universal class. This is an unchanging aspect of what Marx wrote.

However, there are other aspects where differences are very much in evidence. For example, Marx stresses that the proletariat is being formed alongside machinery and mass production, so ensuring the socialisation of production. But that is not the nature of modern plants. It is less and less the case - a state of affairs which arises from Marx's theory (coming actually from Hegel) that ultimately machines will make machines.

It follows that there will be fewer and fewer manual workers and an increasing number of white-collar workers. Secondly the integration, the international division of labour, that Marx stressed is related to mass production. That integration still exists, but in a different form.

The interrelationship between people in production - whether white-collar or blue-collar or even working from home - has become closer and closer and more intimate, even if they are no longer standing next to each other. The internet is the most positive expression of this. So the Marxist argument of the power of the proletariat being based on its close interconnection is as true as it was then. In Marx's time the white-collar workers were very largely so-called middle class.

Bernstein made much of this in 1896, when he argued that Marx was wrong in emphasising the polarisation between the two main classes: on the contrary, he said, there was an increase in the number of white-collar workers separate from the working class. The Stalinists in their own way repeated this, albeit in a different form. In distinguishing between productive and non-productive labour (which has tended to be identified with white-collar work, although it is not quite the same thing), they quite wrongly argued that non-productive work could not be included in the category of labour at all. That is completely untrue.

It does not really make any difference whether a worker is productive or unproductive, according to Marx in Capital. It was true that in Germany there were an increasing number of people who, as a direct result of imperialism, were petty bourgeois. But today we can see that Marx's prediction of the increasing proletarianisation of society has actually come to be. There are very few white-collar workers who are so-called middle class.

Proletarianisation is proceeding so fast that even academics are being proletarianised. Alongside this increasing proletarianisation of the labour process there is another tendency: the labour-power of the particular group is now being sold without any qualification. That is to say, the worker, or seller of labour-power, has less and less control. Marx does not talk about the decline of capitalism, but about its supersession.

He refers to the future society, but only in a negative way. It is only the later writers - Lenin, Trotsky and others - who are able to talk of the decline of capitalism. The decline was characterised by imperialism - the extraction of surplus value from the undeveloped world. This could then be used in the developed, metropolitan countries - both to bribe part of the proletariat, as Lenin saw it, but also to avoid crises. It meant a temporary easing of class conflict - a stasis in the overthrow of capitalism at the time of its decline.

Thirdly, the decline of capitalism must include the decline of value itself. That again has two aspects, one of which was discussed by Lenin at some length - the question of finance capital and its parasitic nature. The second is the increasing role of the state and of individual firms in controlling the market, thus overriding the law of value. Margaret Thatcher was talking nonsense when she said you can't buck the market - the idea that in the stock exchange everyone is buying and selling shares and nobody controls it is simply fantastic.

It is quite clear that a few people - not even a few companies, but a few people - play an enormous role in doing just that. This may not have been the case in Marx's time. There may well have been a large number of competitors within different industries - before the joint stock company came into existence. But, once it did come into existence, Marx said the capitalist was now unnecessary. For him the joint stock company represented a new socialised form.

I think we have to go along with that: this increasing degree of socialisation brings with it a diminution in the role of value. In Marx's time there was a world currency, gold - the universal equivalent, as he described it, the world money. And, of course, money is absolutely crucial in understanding value.

Today we no longer have gold: we have printed paper, consciously printed by governments, and controlled by governments as a nationalised form. It is not an accident that the dollar is the main currency - this is because the United States is the dominant power.

But the dollar is money - and yet not money. It no longer operates as value. It is issued and controlled in a particular way, as consciously determined by the bourgeoisie, not the law of value. One more example to illustrate this decline, which occurred in the home of capitalism, the United States.

In the 1980s all the US mortgage companies - the building societies, as they are known in the UK - went bankrupt and were nationalised. So we have the peculiar position that, whereas in this country building societies are all in the private sector, in the United States they are part of the state sector. The country of private enterprise has totally nationalised the lending of money for housing.

Fourthly, the very fact of the Russian Revolution of 1917 has altered the face of capitalism. It is true that the Soviet Union has (thankfully, given what it became) ceased to exist, but the revolution itself affected the capitalist mode of production. It overthrew capitalism, of course, even if in no sense was the USSR, or any of the countries associated with it, socialist.

However, it was not based on the market, and to that degree it had an automatic antagonism with capitalism. This meant that capitalism had to adapt - and it did adapt. We cannot speak, it seems to me, of 1940-1973 as a natural evolution of capitalism. It was a period of deliberate concessions made by the bourgeoisie. In this country the standard of living rose three times. Quite exceptional - during the whole period, 1800-1940, it grew at a rate of one percent per year.

But in order to pay for those concessions growth became an aim. Growth is not an automatic consequence of capitalism - there is no reference to it as a goal in the Communist manifesto. The goal is surplus value and profit, not growth - and certainly not to raise the standard of living: why should the bourgeoisie care about the standard of living of the proletariat? And yet in 1940-1973 the standard of living was deliberately raised, and growth became a goal.

Once that happened, it became permanent. It is true that in 1973 finance capital was reintroduced. But the legacy of the previous period still remains. Down to the present day, politicians have to talk about the standard of living (even if it has hardly risen since 1973 in the United States). They have to discuss full employment even when they do not have it. They have to retain social welfare in some form. The result is a different type of capitalism, which is more restricted, more controlled and open to different forms of malfunction.

There is no longer a reserve army of labour, even if 20% of the male population are unemployed. In other words, the changes the bourgeoisie was forced to introduce after 1917 are permanent. They cannot be undone despite the wishes of the ruling class. The capitalist class would dearly like to go back to the old system, to reintroduce gold rather than paper money as a genuine universal equivalent. The Reagan government talked about doing just that, but it was impossible.

Similarly privatisation could not go the whole way. The utilities are now privatised in Britain, but there is also a regulator, with the result that profits are controlled. In the 1990s the profit rate was declared to be very high, but it turns out that perhaps it was really very low. Workers' pension funds were robbed, shares were issued instead of wages - devices to maintain the appearance of increased profits and the illusion of additional surplus value. The result was Enron and other scandals.

The relationship between capitalists has become more and more stressed and more and more deceitful. They trust each other less and less. Today, then, we are no longer living under the laws of a pristine capitalism. The laws that exist are those of a declining capitalism, a capitalism in transition that is in the process of becoming something else, of being positively superseded.

Yet in order to grasp these laws we have to start from Marx. The Communist manifesto is absolutely essential in this regard - we have to study Marx's simple yet profound truths in order to understand the complexities of today. Finally, was Marx premature in his belief that the proletariat was capable of taking power in his lifetime? Or, for that matter, in view of the failure of 1917, was the Russian Revolution premature? And since, in the 21st century, the means of production can still be developed, should the proletariat wait another 200 years? Absolutely not. Even in Marx's day, even though it was relatively undeveloped compared with the present, the proletariat could have taken power.

Our class could very quickly have developed the means of production - much more quickly than the bourgeoisie has done. When Marx was writing, in 1848, and at any time since, it has been possible for the universal class to take power.