This "conundrum" in Marx (and Engels) is rather simple to explain. Capitalism is antithetical to competition in that competition reduces profit and capitalism is based on profit and profit rate according to Marx (and Engels).
"Competition is for losers." — Peter Thiel on the benefits of monopoly.
Free competition in a perfect market drives down the profit rate and a falling profit rate leads to a falling investment rate. Capitalism is based on investment for generating profit.
Therefore, capitalists prefer imperfect markets, asymmetry, and seek institutional bias that creates artificial scarcity and encourage monopoly. Financialization supplements low wages with debt leading to debt servitude.
Capitalists dream of low wage economies and monopoly capital. Marx and Engels got that long before Peter Thiel.
According to Marx and Engels, this leads to increasing inequality and sets the stage for workers to revolt against capitalist regimes and institute socialist production in place of capitalist.
So far, things seem to be developing on schedule.
The Real Movement
Marx never thought capital was compatible with commodity productionJehu
17 comments:
Marx didn't foresee the invention of the mixed economy, along with antitrust laws.
Speaking of antitrust when is somebody going to start looking at Amazon....
In the Bible, profit is good but profit taking isn't good.
Then note that common stock is a private money form that allows profit WITHOUT profit taking.
But why should those with equity share it when a government-privileged private credit cartel, aka "the banks", allows them to legally steal the public's purchasing power/investment opportunity?
So to be pro-bank, as the MMT School is, is to be, literally, against a much more equitable society.
Btw, a huge part of Amazon's success is the refusal to pay dividends and that's smart since the purpose of a common stock company is to consolidate assets for economies of scale, etc., not dissipate them (i.e. take profits).
Steve Randy Waldman, who blogs under the name "interfluidity", sees a possible different development. A quote from his blog:
Marx, at least in my vulgar Cliff-Notes understanding of his oeuvre, predicts a progression like
Feudalism ⇒ (revolution of the bourgeoisie) ⇒ Capitalism ⇒ (contradictions of capitalism) ⇒ Socialism.
But perhaps it’s more parsimonious to imagine that, in the face of contradictions, society might revert to its most historically stable prior form, rather than inventing a new one. Maybe rather than a progression, we risk a cycle
Feudalism ⇒ (new technological possibility yields a revolutionary bourgeoisie) ⇒ Capitalism ⇒ (contradictions of capitalism yield conflict and backlash) ⇒ Feudalism (at a new technological level, but with uses controlled and further development suppressed).
Social democracy or feudalism
Socialism has been tried and rejected numerous times.
Otoh, the Bible based economy in ancient Israel survived 400 years without a king and then several hundred more with kings.
And no, the economy in ancient Israel wasn't feudalism but was composed of roughly equal citizen owned farms, vineyards, etc.
@ Ahmed Fares
I would take issue with this point. Of the factors of production (land, labor and capital) feudalism is the system that favors land owners. Capitalism is the system that favors owners of capital. Socialism is the system that favors labor.
Feudalism prevails under agriculture, and capitalism under technology. They are quite different from this vantage and I don't see a return to feudalism dominated by "land lords."
Rather, capitalism tends toward monopoly capital which resembles feudalism in that it creates an oligarchy based on property ownership. So it might be called neo-feudalism to distinguish it from pure capitalism.
And no, the economy in ancient Israel wasn't feudalism but was composed of roughly equal citizen owned farms, vineyards, etc.
How would you classify it, Andrew?
@Ahmed Fares
What does the 'Great Reset' sound like to you?
Speaking of antitrust when is somebody going to start looking at Amazon...
4 years from now?
@Tom Hickey,
"So it might be called neo-feudalism to distinguish it from pure capitalism."
I believe that's the meaning intended in the article that I linked to. The article ends with this (bold mine):
"I’d rather explore the full space of social democracy before making any kind of peace with a journey, however partial, towards legitimating permanent hierarchy and caste warily enforced by deployment of coercive violence against internal threats."
A caste hierarchy would be neo-feudalism.
Peter it’s called “Moses and the prophets” figuratively in Scripture...
They (Abraham descendant Israel) were given a strict code of behavior and conduct (“Moses”) with an incentive if they complied (“the prophets”)....
It obviously was a complete failure and didn’t work....
Non discriminatory Dialogic morons in the philosophical tradition like our AA have synthesized that methodology into what they now call “Judeo-Christian!” which is a synthesis of old and new testaments into another one of their confused synthesized miasmas of ever conflicted religious doctrines... and here we are...
Might have started to be on the way out in about 1860 but if so is obviously taking a long time in human terms...
Therefore, everything that you would like people to do to you, do [these things] to them also. For this is [what is required by] the law of Moses and the prophets.
- Matt 7:12
Source: https://bible.knowing-jesus.com/phrases/Moses-and-the-Prophets
^
An economic system characterized by reciprocity?
@Peter Pan,
As regards the Great Reset, it's too hard to tell. They're using vague terms like "stakeholder capitalism", etc.
If by "stakeholder capitalism" they mean don't destroy the environment while you're making a profit, I'm on board with that. If however they mean forcing corporations to support social justice issues, then they're forcing shareholders to do what the government and private charities should be doing. Here's one person's definition:
"Capitalism, as we know, it is dead. We’re going to see a new kind of capitalism—and it won't be the Milton Friedman capitalism, that is just about making money. The new capitalism is that businesses are here to serve their shareholders, but also their stakeholders — employees, customers, public schools, homeless and the planet." — Marc Benioff, Chairman and co-CEO of Salesforce
Incidentally, anyone who has studied tax incidence will understand that the corporations will pass along the costs in the form of higher prices for goods and services, in effect a consumption tax, which is a regressive tax that strikes hardest at the poor.
It obviously was a complete failure and didn’t work.... Franko
The sacrificial system was obviously inadequate and was abolished by the perfect sacrifice of Christ.
But as for failure, it's government privileges for usurers and no limits to land ownership, both contrary to Scripture, that are the proven failures.
An economic system characterized by reciprocity? Peter Pan
It was characterized by roughly equal land ownership with provisions in the Law of Moses to keep it that way.
So all Hebrews would normally be roughly equal land owners.
So where's your correction, Franko?
You haven't any since, contrary to the New Testament*, you ignore the Old Testament too.
*e.g. 2 Timothy 3:16-17
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