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Karl Marx: A great economist with a poor focus

By Evelina Sweitzer
web posted October 25, 2010

"Gentlemen… I vote in favor of free trade." –Karl Marx, to the Democratic Association ( January 9, 1848)

Widely considered the foremost philosopher of Socialism, Karl Marx believed wholeheartedly that a society based on Capitalism—that is, one incorporating free trade—would eventually destroy itself. So why did he refer to the 1846 repeal of England's Corn Laws as "the greatest triumph of free trade in the 19th century"? Why did he ask to speak before the 1847 Free Trade Congress in Brussels? And why did he make a lengthy speech, entitled "On the Question of Free Trade," presenting his support before the Democratic Association? Marx's Socialist and Communist opinions, it turns out, could actually coexist with his proclaimed endorsement of free trade—if one takes into account his opinion of the eventual effects of the movement. The key lies in Marx's reasoning itself, best explained in the final words of that very speech: "...The free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favor of free trade." [1]

Marx believed sincerely in the eventual failure of Capitalism, seeing in its future a continuous downward spiral of falling conditions for workers and worsening conflicts between classes—a situation he believed would only end in mass revolution. And out of these ashes he envisioned the phoenix of Communism, rising to the salvation of all—as Ruffin and Gregory put it in Principles of Economics, "Marx promised that, under Communism, class conflicts would disappear, people would work for pleasure, and distribution would reflect need". [2] Marx outlines in his speech to the Democratic Association all the evils done to the lower classes by the benefits of free trade, making the following point:

…The growth of productive capital implies the accumulation and the concentration of capital. The centralization of capital involves a greater division of labor and a greater use of machinery. The greater division of labor destroys the especial skill of the laborer; and by putting in the place of this skilled work labor which anybody can perform, it increases competition among the workers.

This chain of events reflects strong reasoning. It is one side effect of industrial progress that the number of jobs in manufacturing decreases and fewer workers may perform more work.

However, where Marx makes the point that division of labor destroys specialization, I believe he is misguided. As economics professor Timothy Taylor pointed out in a lecture on the division of labor, when woks can specialize in a particular task, it allows those with various skills to work in positions where they have an advantage. [3] Skilled work is not replaced with labor which anybody can perform, but with a new set of tasks and required skills that workers must maintain. Marx uses the word "competition" to focus on the misfortune of unnecessary workers who could not keep up with the progress, but ignores the benefits to those who adapt. Indeed, in any society—even a Communist one—unemployment will exist. How else would there be incentive for a worker to stay at his job?

In my study of his speech, I discovered that many of Marx's arguments against Capitalism and free trade would also apply to his ideas for a Communist society. He argues, "Do not believe, gentlemen, that it is a matter of indifference to the worker whether he receives only four francs on account of corn being cheaper, when he had been receiving five francs before" (Marx). But what if the worker receives only four francs on account of his fifth being distributed to another by the government? Indifference is not contingent upon a worker's perception of where his misfortunes come from—man is selfish, caring more about his missing franc than whether the government or free trade is responsible. Marx argues against the relation of wage labor to capital by saying, "it does not matter how favorable the conditions under which the exchange of commodities takes place, there will always be a class which will exploit and a class which will be exploited". But would not the same also be true under the "favorable conditions" of communism? Exploitation "always" finds its way into society, even a Communist one—dominance emerges, especially when supreme control is handed to the state.

Marx ignores this possibility, focusing on the atrocities of free trade in England's modern Capitalism. "Either we must reject all political economy based on the assumption of free trade, or we must admit that under this free trade the whole severity of the economic laws will fall upon the workers." And admit it he does. Moreover, Marx embraces it—in an almost Anarchist fashion, he describes the misfortunes to come from the movement which has gained his vote:

The more productive capital increases, the more it is compelled to produce  for a market whose requirements it does not know, the more production precedes consumption, the more supply tries to force demand, and consumption crises increase in frequency and in intensity.

The key? "Every crisis in turn hastens the centralization of capital," he says, "and adds to the proletariat." Marx was willing, in true Communist fashion, to approve of changes to the economy that he knew would result in misery and revolution—all in the hope that one day the revolution would climax, the proletariat would rise in power, Capitalism would be overthrown, and his Communist Manifesto would be lived out.

"From each according to his ability, to each according to his needs," said Marx. This "great economist" clearly believed that free trade would worsen the conditions of the lower class, but advocated it anyway—as a means of achieving his Communist Utopia. Did he really deem the needs of each man met, when he advocated an "evil" economic decision as a means to achieve an end he considered worth the sacrifice? Every experience I have had with Socialist and Communist doctrine, be it economical, governmental, political, or social, has appeared logical and justified on the surface. Beneath that surface, however— interwoven in the fibers of the theory— is the credo that a perceived benefit to the anticipated many outweighs the immeasurable suffering of the current few. Perhaps Marx was right about the conditions of the working class; perhaps nineteenth-century England should have focused less on the welfare of its industry and more on the welfare of those fueling it—but however valid these points, when the man advocating these changes in the same breath expresses such hardhearted and callous inclinations, he loses whatever credibility he had gained in my opinion. ESR

Footnotes:

[1] Marx, Karl. "On the Question of Free Trade." Speech. The Democratic Association of Brussels. Brussels. 9 Jan. 1848. Karl Marx: On the Question of Free Trade. The School of Cooperative Individualism. Web. 14 Sept. 2010.

[2] Ruffin, Roy J., and Paul R. Gregory. "Chapter 1: Economics and the World Around Us: Defining Moments." Principles of Economics. 7th ed. Boston: Addison Wesley, 2001. 3-16. Print.

[3] Taylor, Prof. Timothy, and The Teaching Company. "Division of Labor." Economics, 3rd Edition. Malacaster College. 2005. Lecture. 12 Sept. 2010.

Evelina Sweitzer is a homeschooled AP Macroeconomics student from Ohio, who hopes to go on to study business leadership management and professional/technical writing in college. © 2010 Evelina Sweitzer

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