Marx and Private Property

international | anti-capitalism | opinion/analysis Wednesday May 03, 2006 18:08 by thtiipwio[pww[e[eor[f

An analysis

According to Max Weber, the capitalist economy of the present day is an immense cosmos into which the individual is born and which presents itself to him at least, as an individual, as an inalterable order of things in which he must live. It forces the individual in so far as he is involved in the system of market relationships, to conform to capitalist rules of action. The manufacturer who in the long run acts counter to these norms will, just as inevitably be eliminated from the economic scene as the worker who cannot or will not adapt himself to them will be thrown into the streets without a job.

Karl Marx however was convinced that this immense cosmos was alterable, needed to be altered and would inevitably to be altered. Man as a species is defined by his ability to create. As William Adams writes, we do not rest quietly in our instincts, as animals do, but consciously create, consciously produce not only the objects of our needs but also the very conditions of our life. “The whole character of a species,” Marx states, “resides in the nature of its life activity and conscious activity constitutes the species character of man…Man makes his life activity itself an object of his will and consciousness.” (Marx, 1975:328). This is who and what we are in other words, makers, creators, homo fabricans.”

When our creativity is suppressed by the reality of the capitalist system we are reined in by the realisation that the disunity between our imaginations and the actually happening world appears unbridgeable. Our resulting alienation and unhappiness can only be compensated for by less satisfying pursuits, activities and states of mind rather than those that would actually fulfil our ultimate potential. In Flaubert’s Madame Bovary, the character of Emma tries to escape her unhappy existence in suffocating domestic married life by substituting it for romantic fiction. They are useless passions of course. Emma is finally destroyed by her confusion between the real and the imaginary, by her insistence on realising in the midst of her painfully real and boring life, essentially compensatory satisfactions. Meanwhile the world goes by untouched by the hallucinatory beauty of her romantic yearnings.

Marx’s philosophy is engrained with the idea of a liberated human aesthetic appreciation. It is our objectification of the things we share the world around us as “private property” which is the source of the misery that he identified around him in 19th century industrial societies. The bourgeoisie capitalists appeared to be only interested in values as they related to the market; individual human beings were only useful gauged by their productivity on the factory floor, an imposing mountain was useful not for its beauty but as a source of mineral wealth, a forest ringing with the calls of songbirds could be converted into lumber, while art could be viewed by a philistine to be increase in value the longer it hung on a wall in his private collection awaiting future sale. According to Marx:
The suppression of private property is therefore the complete emancipation of all human senses and qualities but it is this emancipation, precisely in that these senses have become a human eye, when its object has become a social, human object produced by man and destined for him. Thus in practice, the senses have become direct theoreticians. They relate to the thing for its own sake but the thing itself is an objective human relationship to itself and to man and vice versa. (I can in practice only relate myself humanly to an object if the object relates itself humanly to man). Need and enjoyment have thus lost their egotistic nature and nature has lost its mere utility in that its utility has become human utility.

Marx identifies this objectification of private property as the root of class divisions. The industrialists, factory owners and professionals form an elite bourgeoisie ruling class in whose hands the majority of the wealth, privilege and power are increasingly concentrated. That power is the means of production legally protected as the “private property” of the elite. The proletariat, without which the industrial and capitalist system would fall apart and upon whom the elite are a parasite, must accept their economic exploitation by their social superiors in return for meagre wages and undignified living conditions. They must accept them as the natural consequences of market forces and that private property is a concept enshrined in law, physically protected by the forces of the police and military and the moral teachings of religious authorities. The immense cosmos cannot be altered because it is appears to be the law of nature and even the divine law: “Thou shalt not covet thy neighbours goods.”

In Marx’s view, it is vain to expect that any important change will be achieved by the use of legal or political means; a political revolution can only lead to one set of rulers giving way to another set of rulers. Only the evolution of the underlying essence, the economic reality can produce any essential or real change – a social revolution. And only when such a social revolution has become a reality, only then can a political revolution be of any significance. But even in this case, the political revolution is only the outward expression of the essential and real change that has occurred before. In accordance with this theory, Marx asserts that every social revolution develops in the following way. The material conditions of production grow and mature until they begin to conflict with the social and legal relation and outgrowing them like clothes until they burst.

In Das Kapital, Marx presumes that the development of capitalism was historically inevitable:
Just as the savage must wrestle with nature in order to satisfy his needs, to keep alive and reproduce, so must the civilised man; and he must continue to do so in all forms of society and under all forms of production. This kingdom of necessity expands with its development and so does the range of human needs. Yet at the same time there is an expansion of the productive forces which satisfy these needs.

But so too is the inevitable revolution that will overthrow the capitalist system which is fundamentally compromised due to its inherent contradictions. According to Marx, the bourgeoisie is in conflict with the very forces of production that it has called into being. The very same tools by which the bourgeoisie brought feudalism to an end will now be taken up against the bourgeoisie itself. The forces of production that created the bourgeoisie class have created the proletariat which is its prey and its opponent. With no private property of its own it is in a position to eliminate what is the “condition” of bourgeoisie capitalism and exploitation. With the bourgeoisie rulers removed from their positions of authority, they can be utilised for the good of the proletariat, as the revolution strives to create a cooperative society in which the economy is arranged corresponding to a “social plan.”

Industry whose unwitting advocate is the bourgeoisie substitutes the disconnection of the labourers due to competition with their revolutionary integration due to affiliation. The development of modern industry consequently cuts itself off at the ankles by removing the very ground on which the bourgeoisie creates and gains possession of private property. Most importantly they produce their own destruction as they lose control of their workers who realising the weakness of their masters’ position unite and seize power - “the means of production.” The fall of the capitalist system, the elimination of private property and the victory of the proletariat are therefore equally inevitable.

Marx’s account of history, capitalism, class divisions and the role of private property in perpetuating human misery was highly controversial in his day and remains so. It was broadly accepted by most radicals throughout the world but rejected by most political and economic conservatives especially in America and Western Europe. The contrasting reactions by individuals to Marxism the bitter ideological struggle between communist and socialist style regimes on one side and liberal democratic capitalist states on the other have their root ultimately in conflicting ideas of human nature and human anthropology. For example the 18th century British thinker, Adam Smith, considered the father of modern economics, could not have had a more contrary attitude toward the notion of private property and capitalist enterprise.

When primitive man existed in the “rude state of society” before there was any division between classes, individuals had to ensure their own survival by hunting, clothing themselves in animals skins, building crude dwellings. As man became civilised presumably by learning farming methods and/or conducting trade using particular skills developed in the towns which were the meeting point of artisans and merchants as an inevitable division of labour emerged. With the famous example of the pin-maker, Smith demonstrated how a single individual might take an entire day to produce a single pin but if the production is broken down into separate tasks by many more individuals specialised in the performance of each of those simplified tasks in the manufacture of a pin they could produce twelve pounds of pins in a day. Marx studied Smith, Ricardo and other economic thinkers whose writing laid the foundation for modern capitalist economics in order to produce his devastating indictment of the activities of industrialists in the 19th century. Smith’s descriptions of increasing specialisation predicted the increasing mechanisation of industry.
I shall only observe therefore that the invention of all those machines by which labour is so much more facilitated and abridged seems to have originally owing to division of labour. Men are much more likely to discover easier and readier methods of attaining any object, when the whole attention of their minds is directed towards that single object than when it is dissipated among a greater variety of things.

These machines according to Marx in turn may be intended either for the expansion of industry, for new factories etc. or they may be intended for intensifying production by increasing the productivity of labour in the existing industries. The former kind of machinery makes possible an increase in employment the latter kind has the effect of making workers superfluous of “setting the workers at liberty” as this process was called in Marx’s day.

Therefore there begins a cycle of depression and prosperity. As production intensifies, wages rise, but also machines, which were once a financial inconvenience, are no longer unaffordable. Once these are utilised prosperity increases but as increasing mechanisation means less need of workers, unemployment increases, wages fall and workers starve. Consumption decreases which means that expanded industry is gradually no longer profitable, leading ultimately to a recession. The resulting stagnation leaves room for recovery as there is now a large workforce prepared to accept low wages. Production can once again commence but at this stage it is not profitable to employ machinery because of the presence of cheap labour. But in the event that industrial expansion is renewed, machines require more labour to produce them, having the knock on effect of increasing wages, a rise in consumption and increasing profits. As prosperity returns the cycle of capitalism with its inevitable crash begins anew. As the trade cycles repeat themselves according to Marx until the misery of the workers reaches to the point of violent revolution due the expansion of the proletariat and the concentration of wealth in the hands of an ever smaller elite bourgeoisie. The bourgeoisie is overthrown and a new socialist economy and society emerges.

The most serious and perhaps fatal criticism of Marxism is the failure to recognise how individual self-interest may be the real glue that holds society together. Self-interest may well be put aside in times of crisis because of the urgency to solve a mutual difficulty e.g. overthrow a tyrant, repel an invasion or to rebuild in the wake of a disaster. But not all problems are mutual and individual problems can often meet the indifference of other individuals who have no stake in their resolution. The solution is often to convince others that it is in their interests and an opportunity for advantage to get involved. Adam Smith could conceive of no other motivation for much of human business activity:
In almost every other race of animals each individual when it is grown to maturity is entirely independent and its natural state has occasion for the assistance of no other living creature. But man has almost constant occasion for the help of his brethren and it is vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self love in his favour and shew then that is for their own advantage to do for him what he requires of them.

Each of us for this reason would be advised to discover a particular skill or resource we could utilise to make our living. If we should be so lucky as to own land on which to grow our crops but are unfortunately unable to sow and reap without the help of others it would be sensible to employ others who have no land or possess less land but wish to supplement their resources by selling their services as labourers in return for a share of our crops to sell for themselves or to buy food. Others might owe a “debt of friendship” to us but business relationships often have their basis in past services rendered. If a previous friendship was non-existent a new one can be forged by the methods already described. Smith describes a range of similar examples to demonstrate a “hidden hand” guiding human behaviour driven by self-interest but which results in greater prosperity for all:
Each animal is still obliged to support and defend itself, separately and independently and derives no sort of advantage from that variety of talents with which nature has distinguished its fellows. Among men on the contrary, the most dissimilar geniuses are of use to one another, the different produces of their irrespective talents, by the general disposition to truck, barter and exchange, being brought as it were into a common stock, where every man may purchase whatever part of the produce of other men’s talents he has occasion for.

A business relationship need not always be perceived as exploitative. What an employee receives as a “fair wage” is subjective to each individual in comparison to those he conceives as his peers. If he is content he will be more likely unconcerned about the profits of his wealthier employer may enjoy as a result of his labour. If he is paid more than his peers he might well be encouraged to work harder and be more productive in order to justify his continued employment to avoid a reason for his employer to change his mind. Both parties are motivated by a return on their investment. Given the choice of a better paid job with better working conditions the employee would be tempted to take up a new career elsewhere whether this leaves his employer undermanned or not. The employer would prefer to employ a worker prepared to accept lower wages and poorer conditions only if he was sure that he could find such a person, if that person could work as productively as the previous employee or indeed if needs be, work more productively, especially at a level of productivity which would not justify the installation of an expensive machine to do the same work.

Most importantly an employer would have more reason to be inclined to maintain or expand the profitability of a commercial enterprise as long as it remained his private property. If he is in competition with others providing the same product or service he will be forced to outdo them their quality, quantity and affordability to win customers looking for a good deal. Meanwhile a manager given stewardship of a private or public enterprise will be reasonably less likely to maintain profitability or efficiency if he is paid poorly in comparison to his peers. The private owner, more than the paid employee, unless he is inept or careless, will be better motivated to ensure the survival of the business if he alone enjoys the profits from his enterprise. The manager has the option of finding work elsewhere but the investment of a private owner is much harder to recover if the business he owns goes belly up.

Indeed when responsibility is given to safeguard public property to individuals even when there is a strong motivation to protect the public interest, private self-interests even in the presence of the most regimented authority and controls is often too strong to resist if the system is large enough for wrong doing to go unnoticed. The corruption in the US Army during World War 2 is a perfect example. The United States was sending to Europe colossal quantities of goods. Given the amounts involved and the constant need for haste, there was a vulnerability that a few soldiers found irresistible. More than a few, really – the figures on stolen goods are staggering. The material for the Americans fighting in Italy came in through the port of Naples. It came in day and night – weapons, ammunition, rations, fuel, trucks, electrical equipment and much more. Every item was eagerly sought on the black market. One-third of all the supplies landed in Naples was stolen. In Italy, once an entire train carrying supplies to the front simply vanished.

A Marxist would insist that following the revolutionary overthrow of the bourgeoisie by the proletariat, humanity would collectively realise the futility of acquiring private property. Indeed as communism becomes more realised human nature would undergo a positive change, leading to a harmonious society increasingly less disturbed by class divisions and individual antagonisms. The bourgeoisie would upon being relieved of the burden of the private property merge with the proletariat and society would follow a centrally planned economy designed for the prosperity of all individuals in society:
The human significance of nature is only available to social man; for only to social man is nature available as a bond with other men, as the basis for his own existence for others and theirs for him and as the vital element in human reality; only to social man is nature the foundation of his own existence. Only as such has his natural existence become a human existence and nature itself become human. Thus society completes the essential unity of man and nature, it is the genuine resurrection of nature, the accomplished naturalism of man and the accomplished humanism of nature.

Marx’s ideas of an aesthetic liberation of the senses from base capitalism have many affinities with the Christian teachings toward the material world. Marx was certainly influenced by Christian teachings encountered through his father’s conversion to Lutheranism and of course by the prevailing Christian culture in 19th century Germany and later as he settled in England.

Christ has often been interpreted by liberation theologians as a proto-Marxist, especially due to his apparent distaste for the rich and his solidarity with the poor. In the Sermon on the Mount, man is extolled to worship God alone forsaking wealth and property and putting his trust in the Almighty to provide for his basic needs: “Wherefore if God so clothe the grass of the field, which to day is, and tomorrow is cast into the oven, shall he not much more clothe you, O ye of little faith?” (Matt 6:30) The first Christians appear to have established communist societies sharing their belongings equally among one another: “Now the company of those who believed were of one heart and soul and no one said that any of the things he possessed was his own, but they had everything in common.”(Acts 4:32).

The difference was that Christ believed he was the Son of God who would return in judgement of the living and the dead, for it was only through his own crucifixion and death that mankind would be redeemed; a “new heaven and a new earth” where every “tear will be wiped away.” It was clear that the perfection of man will never occur so until then that Christians who tried to implement his teachings could only hope to be martyred or suffer patiently for their faith while the reign of sin would continue. But for the rich man who wishes to be Christian there is a heavy price to pay: “If you would be perfect go, sell what you possess and give it to the poor and you will have treasure in heaven and come, follow me.”(Matt 19:21)

However Marx believed that religion was the “opium of the people,” a drug which the rich and powerful had administered to the alienated proletariat to make them forget about altering the status quo; indeed it was the divine law that the poor had to face injustice in this world before paradise in the next as a reward for their patience. Marx, an atheist, was convinced that revolutionary change would come by human hands in the material world, which is all that truly can exist in a godless universe:
This material, immediately sensuous, private property, is the material, sensuous expression of man’s alienated life. Its movement of production and consumption is the sensuous revelation of all previous production i.e. the realization or reality of man. Religion, family, state, law, morality, science and art are only particular forms of production and fall under its general law. The positive abolition of private property and the appropriation of human life is therefore the positive abolition of all alienation, thus the return of man out of religion, family, state, etc. into his human i.e. social being.

But the idea that Jesus was a proto-Marxist is a very selective reading of the Gospels. Generally Christianity sees a life forsaking spiritualism to be the greater sin. A rich man can be righteous by being generous, by providing employment, caring for the welfare of his workers and making donations to charities. Hard work and shrewd business practice are virtues and combined with a social conscience are the definitive model for the Christian life. Jesus was not advocating the elimination of private property but rather that the wealthy and powerful have a duty to society. But their servants have a corresponding duty to their masters that reflects the duty of all the community to God and one another. In the parable of the talents, the third servant is punished because he hid his one talent in the ground while his peers multiplied their master’s property. Throughout Christian theology is the concept of reaping and sowing which certainly appears to make a virtue out capitalism.

Max Weber posits that the Protestant work ethic is at the root of the formation of modern capitalism. Capitalism existed in China, India and Babylon and in the classical world but it lacked the particular protestant ethos that was unashamedly capitalist. Money was made not to be enjoyed, but rather invested in the capitalist enterprise. A capitalism based on the strict Puritanical and Calvinist tradition was in marked contrast to an unrestrained capitalism in other societies which gave free rein to selfish interests and absolutely unscrupulous dealings with others that ensured backwardness. The ability of concentration as well as the absolutely essential feeling of obligation to one’s job are here most often combined with a strict economy which calculates the possibility of high earnings and cool self-control and frugality which enormously increase performance. This provides the most favourable foundation for the conception of labour as a means to an end in itself, as a calling which is necessary to capitalism: the chances of overcoming traditionalism are greatest on account of the religious upbringing.

It is no accident that it was Protestant colonialists in America, many of them the descendents of puritans who had fled religious persecution who revolted against the English using the slogan, “No taxation without representation.” They had established themselves in an alien country carving farms out of the wilderness, built cities and towns and grew wealthy through trade. Colonialists because of their distance from English rule enjoyed a greater degree of economic freedom than the English themselves and when British national debt grew because of the Seven Years War for many years afterward it was felt that colonialists who were prospering should bear the burden of colonial rule. It was private property owners who faced economic hardship from unjust taxes (in their eyes) who led the American War of Independence. “Life, liberty and the pursuit of happiness” went hand in hand with control over their own property.

Ever since in American and most European liberal democratic capitalist societies, private property rights, prosperity and the democratic system of government have been inextricably linked. The importance of having well-defined and strongly protected property rights is now widely recognised among economists and policymakers. A private property system gives individuals the exclusive right to use their resources as they see fit. That dominion over what is theirs leads property users to take full account of all the benefits and costs of employing those resources in a particular manner. The process of weighing costs and benefits produce what economists calls efficient outcomes. That translates into higher standards of living for all.

An obvious example has to be the rapid development of air transport over the past 100 years and more rapidly since the recent liberalisation of markets, once dominated by heavily subsidized state-owned carriers that have been overtaken by cheaper more efficient airlines who have taken advantage of a previously overlooked customer demand. The first Wright brothers’ aeroplane was capable of only limited flight but private investment in the resulting aircraft industry facilitated growth and innovation. Had a government bureaucracy administered the development of air travel without being motivated by a business ethos the idea of regular passenger air travel might well have remained in a dusty filing cabinet. However individuals in Boeing and McDonnell Douglas and many other aircraft companies realised that aircraft could become bigger, faster and fly higher and further. Originally aircraft were made of wood and cloth and reserved for daredevil enthusiasts who had to build their own but today giant jet airliners carry literally millions of people around the world ever day. Meanwhile in the remaining communist countries such as famine stricken North Korea ordinary people regimented according to central planning have to be kept ignorant of such banal capitalist luxuries by state controlled media to prevent civil unrest.

Another example is the success of Hong Kong and Singapore who dwarfed the economy of their much larger resource rich Chinese neighbour for decades. Hong Kong and Singapore are city-states almost completely lacking natural resources. They border much larger and poorer neighbours. Hong Kong in particular experienced long periods of immigration from its poorer neighbour, mainland China. Yet both island nations experienced growth of real per-capita GDP at 5 percent for a long period. Singapore’s real per capita GDP doubled from 1962 to 1971. The real per capita GDP of Hong Kong, a former colony of Great Britain, now exceeds that of the mother country ($25,153 vs. $23,509 at PPP in 2000). The paradoxes abound. Despite its own recent economic miracle, China’s real per-capita GDP in 2000 was still under $4000. Taiwan’s is over $17,000, more than four times China’s. (Both measured in PPP). The most likely explanation appears to be the negative effect of centrally planned economics in China and the positive effects of the rule of law that protects private property and individual liberty in its capitalist neighbours. Recently China shows signs of increasing economic liberalisation as a vast consumer market continues to grow and benefit the entire globe.

Marx believed in a law of diminishing returns that doomed capitalist economies to inevitable revolutions by an impoverished proletariat when in fact centrally planned economies have proven to seal their own downfall. Without the right to own their own property ordinary workers depended on the state for their income eliminating any incentive to be productive and efficient. The economic return from state industries suffered as a result while productive output collapsed. Without a market to gauge consumer demand there was an increasing scarcity in practically every commodity including food. To maintain the existence of the state and basic infrastructure, ideologically rigid communist governments, while maintaining severe restrictions on imports and exports, resorted to forced labour and mass executions of dissidents. Fearful of foreign invasions they maintained enormous militaries that swallowed even more valuable resources. The remaining options were increasing poverty, civil war or else simply surrendering to the pressures for democratic and economic reforms. North Korea, one of the few remaining communist states have refused to reform has sealed its economic and diplomatic isolation. South Korea enjoys some of the highest living standards on earth while the inhabitants of its northern neighbour survive on roots and grass.

Controversial social conservative activist and author David Horowitz, himself formerly a Marxist has become a bitter critic of those who remain committed to Marxist ideology: “One billion people have been impounded in totalitarian states and gulags and one hundred million people have been murdered in our lifetime by Marxists acting on these false premises. That they should be endorsed today by anyone at all is a moral disgrace. This is what we should remember on the 150th anniversary of Marx’s destructive work. Political power is not “merely the organized power of one class for oppressing another.” In democratic market societies, where social mobility is fluid, the people are sovereign and the rule of law prevails, classes do not “oppress” one another and those who inflame the passions of revolution are inciting their followers to commit criminal acts. Period.”
Marx writing in the 19th century could not have known that the evils perpetrated committed by Lenin, Stalin, Mao, Pol Pot, Kim Jong Il and many others lay ahead. He was outraged by the complete disregard for the dignity of workers in factories and mines, many of them only children forced to work long hours in stifling conditions for starvation wages. Industrialists in his time had yet to experience the power of organised trade unions or social democratic parties who would fight long and hard against corruption and vested interests. Indeed businessmen learned gradually that workers who knew their rights were protected by law, worked more efficiently and that generous wages created workers who we also consumers. Competition fuelled greater innovation resulting in greater production and a larger variety of cheap quality goods that were affordable to the majority of the working population. Meanwhile governments who controlled interest rates, introduced sensible deregulation of industry, controlled unnecessary spending and lowered taxes allowing economies to prosper and limited the effects of economic recessions. We must admit that Marx saw many things in the right light. If we consider only his prophecy that the system of unrestrained capitalism as he knew it was not going to last much longer and that its apologists who thought it would last forever were wrong, then we must say he was right. He was right too in holding that it was largely the “class struggle” i.e. the association of workers that was going to bring about its transformation into as new economic system.

Modern capitalism though has to be guided by strong democratic government evidenced by the exploitation of Third World workers by multinationals relocating from the West taking advantage of an pre-existing culture of corruption and weak labour laws in emerging democracies. Some of the more extreme anarcho-capitalists claim that state governments are obsolete in a globalized economy and that business should be left to regulate itself and that issues of Third World poverty and injustice will be made right by market forces. But many others, both economic liberals and socialists see this form of extreme emerging ideology is easily as dangerous as the extremes of Marxist ideology in the 20th century. The role of business has always been that of making and enforcing business laws, guiding business toward its social responsibility and raising revenues to build roads and bridges, fight crime and pollution, organise unemployment claims, promote education and health and perform other functions that only government can perform. Organizing any modern society in response to social and economic inclusiveness in these changing times requires a partnership between government and the private sector in which neither “interferes” but rather each enhances the other’s role in society.”