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Guest Post: Karl Marx Makes a Comeback

Tyler Durden's picture




 

Submitted by John Rubino via The Dollar Collapse blog,

A perfect sign of the times is the unexpected success of a 700-page economics text called Capital in the 21st Century by French college professor Thomas Piketty. As of April 30, it is the best-selling book in the world and is generating the kind of controversy that one would expect for what is reportedly an updating of Marxist theory for the Internet age.

I haven’t read it, so can’t comment on the book itself. But the subject is a good springboard for a look at the actual tragedy of Karl Marx, which is that his ideas got tried out in the real world.

There are two parts to Marx’s main theory. One is a critique of capitalism as a system in which the guys who own factories and hire workers coalesce into an international class with a very specific set of goals: to drive workers’ wages down to just enough to keep them alive, to accumulate as much wealth as possible and to use that wealth to take over the political as well as the economic system. Eventually this process reaches a point where the 1% own pretty much everything, the 99% own virtually nothing, and the latter finally get fed up and take it all back for themselves. You get either a violent revolution or a political process that results in massive wealth taxes and comprehensive social programs to redistribute the capitalists’ ill-gotten gains.

So far, so good. This pretty much describes the period since 1971 when the world stopped basing their currencies on gold and began pouring trillions of newly-created, totally-unbacked dollars into a banking system that evolved from supporting real wealth creation to basically running everything for its own benefit. Bankers and their corporate and political allies accumulated vast fortunes while the rest of the world was pushed ever-further down the economic ladder. And now comes the revolution, with rising taxes and massive new entitlements in the developed world (see Obamacare in the US and a doubling of the sales tax in Japan) and violent revolutions in much of the developing world.

So Marx got this right and would be seen as a prophet if he’d stopped there. Unfortunately, he went on to predict that the revolt of the 99% would result in a “dictatorship of the proletariat” in which workers of the world abolished private property and ran things so wisely that government would just fade away.

This is of course crazy, and when it was tried in the 20th century it failed with catastrophic consequences for the Soviet Union, China, and a long list of smaller but no less tragic countries. In case the reasons for this failure aren’t obvious, here are the two big ones:

1) You can’t eliminate ownership of property. If it exists, someone has to own it, and if private individuals don’t, then government does. Governments are run by people and people are infinitely corruptible, so giving politicians and bureaucrats the infinite power of total ownership necessarily, always and everywhere, produces dictatorship. You just end up replacing rapacious but creative international bankers with brutal and uncreative political hacks.

 

2) This economic vision is static. It says that today’s factories represent society’s “wealth” and that running them right and distributing the proceeds equitably produces a happy world. But a modern economy is dynamic. Today’s factories are constantly being surpassed by tomorrow’s, as entrepreneurs come up with better ways of doing things. This creative destruction is the real source of wealth and the reason that capitalist societies progress — in terms of product quality and cost, if not necessarily in good sense and compassion. Compare today to 1950 and, well, there’s no comparison. One would have to be insane to go back to a time before smart phones, stem cell therapies and the Internet.

To freeze progress by putting bureaucrats in charge of everything is, in effect, telling creative individuals not to bother working 16 hours a day and taking big risks to revolutionize biotech or microchips or solar power because even if they can get their ideas past the people who would be made obsolete, they (the inventors) won’t be rewarded for their efforts in any tangible way. So, as Ayn Rand explained in Atlas Shrugged, the creative class goes on strike and society stagnates.

The result: brutal dictatorships and the eventual dismissal of the Marxist ideas on which those societies are founded.

Which is too bad, because Marx’s critique of the modern world was right-on, and the first half of his scenario is playing out just as he predicted. Now the challenge is devising a monetary/financial reset that brings the 99% back into the game without producing a stagnant dictatorship. It will help if we understand why it’s happening.

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Sat, 05/03/2014 - 15:17 | 4724236 TeamDepends
TeamDepends's picture

And the Marxist Utopia lives on!  In the future, of course.....

Sat, 05/03/2014 - 15:56 | 4724322 Alethian
Alethian's picture

Utopianism FTW!!!

Sat, 05/03/2014 - 15:18 | 4724238 seek
seek's picture

Way off topic, but Tyler needs to pick up this story: http://reason.com/blog/2014/04/28/doj-operation-chokepoint-and-porn-stars

I've only seen it mentioned on one other posting here so far. It goes way beyond porn stars, I know at least a half-dozen firearms-related firms that had similar issues and it all comes back to the choke point program. Even the ABA is getting pissed about it.

The presentation by the FDIC seems to support the notion that they're going after several legal activities along with plenty of illegal ones: http://www.microbilt.com/communications/FDIC-OCC-DOJ-Presentation%289171...

As usual, everything goes back to the DoJ.

Sat, 05/03/2014 - 15:28 | 4724264 TeamDepends
TeamDepends's picture

Definitely not off topic, seek.  Choking can go both ways.  Can you feel it?

Sat, 05/03/2014 - 15:19 | 4724242 Dorelei
Dorelei's picture

The last time someone tried to lever on technology to suppress the bureaucratic-technocratic-sclerotic side of an  outdated communist system the USA just staged a coup and killed a democratic elected president to instaure a ruthless dictature ....

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

Sat, 05/03/2014 - 15:24 | 4724245 honestann
honestann's picture

Entice the 99% back into the game?  Give me a break!  If the 99% have ANY sense, they will completely leave the game and never, ever take any part ever again.

If anyone seriously imagines that the human producers of this world need the human predators for any reason whatsoever... they are absolutely, completely, totally and utterly insane.  The 1% are destroyers, not producers.

Sat, 05/03/2014 - 16:31 | 4724393 SDShack
SDShack's picture

Exactly correct. It's the Sociopath way.

Sat, 05/03/2014 - 15:20 | 4724247 maskone909
maskone909's picture

Citizens under socialism are easier to contrrol. So yeah no doubt thats why they are pumping this so hard. Sheeeit

Sat, 05/03/2014 - 15:22 | 4724251 Winston Churchill
Winston Churchill's picture

Take a walk through Highgate(London) cemetery, and piss on
his mausoleum.I used to live round the corner, and often did,
on the walk back home from the pub.

Sat, 05/03/2014 - 15:54 | 4724318 Alethian
Alethian's picture

You, sir, deserve a pint.

Sun, 05/04/2014 - 00:07 | 4725197 Hulk
Hulk's picture

I sense a never ending cycle developing here !!!

Sat, 05/03/2014 - 15:28 | 4724265 windcatcher
windcatcher's picture

 

The internet is CIA “Chaos” central control, The secrecy and anonymity of the internet only applies one way. We do not know the identity of the poster but “Chaos” in CIA central control in Utah know each and everyone of us and “every thing” about us. Beside your identity profile is a box check with +- or 0 that will indicate if you are brainwashed, not brainwashed or hopeless individual.

 

Age demographics and education are important in replacing the generations of “Free Enterprise System, Fair Trade and individual Democracy” (government of, for and by the People) with another government of globalized “Free Market Corporate Fascist” brainwashed generations. Any “individual” over 50 will have a 0 check by their name. American school children being brainwashed under global United Nations Agenda 21 Century will have a + next to their name.

 

Time and corruption is all that is needed to destroy and restructure American society.

 

The Trilateral Commission is meeting today secretly to decide our fate. The global Bankster/Big Oil/ Military Complex corporate conglomerate US empire started operations in 1979 to overthrow the United States of America and destroy the Free Enterprise System of capitalism: totalitarian CIA “Chaos” is in central control today.

Sat, 05/03/2014 - 18:24 | 4724611 deflator
deflator's picture

 God will not allow this to continue indefinitely...

Sat, 05/03/2014 - 15:28 | 4724266 Oh regional Indian
Oh regional Indian's picture

Actually the problem is not a monetary one anymore.

Machines taking over human jobs....you pay machines nothing in essence except capex and maintainence/Ops charges.

http://aadivaahan.wordpress.com/2010/06/13/machine-strong-human-weak/

Humans are being made redundant as producers of meaningful value. First slowly then fast.

We need to re-value our relationship with machinery, with the disease of modern design...we need to embrace the machine. Right now, we are at war with it.

To our great detriment.

Butlerian jihaad or In Dust Real Ensign?

Somewhere in perfect balance between the Amish and Mr. Singularity perhaps...

ori

http://squareandc.net

Sat, 05/03/2014 - 15:40 | 4724285 Caviar Emptor
Caviar Emptor's picture

Work fills the time available for it. Machines will soon compete with each other as efficiency improves.

Sat, 05/03/2014 - 15:41 | 4724287 blabam
blabam's picture

If it wasn't for fed inflation taxes rules/ regulations and shit the west would have 2-3 day workweeks. 

Sat, 05/03/2014 - 17:46 | 4724550 Marco
Marco's picture

Without government intervention employers will just employ less people for more hours, it's more efficient.

Sat, 05/03/2014 - 15:32 | 4724275 q99x2
q99x2's picture

The reason Marxism and communism could not work was because up until now open source software could not have replaced the role of governments.

Now's the time. End of oligarchs. Rise of the machines.

Long live everyone.

Sat, 05/03/2014 - 15:36 | 4724282 bcecil
bcecil's picture

Very simple fix. Poverty is created all over the world, and always has been, by despots and psychopaths who control all things financial for their own gain.
What many people really don't get yet is Bitcoin/Litecoin are the worlds first, very liquid, average persons, commodity/asset of exchange and, complete trust system, that  doesn't need any governments or banks to exist and it's impact on the lives of the average  person will be way bigger then the internet.
Here  is how you permanently stop all political/government/big bank control with bitcoin/litecoin.. we can also free all of the worlds debt slaves = 99% of population!
New universal and local exchanges must marry BTC/LTC ( which is really a form of an asset not a currency or money ) with gold/silver/commodities It will lead to a grand new world reserve liquid trading commodity vehicle (not currency ) ... and eliminate ALL potential regulation problems with bitcoin/Litecoin being equated to one, or any fiat government currency, taking the power completly away from all of the despots and  psychopaths who control all things financial for their own gain.
One day soon, when a hard working person in Somalia ( or name impoverished country here ) receives the same pay as as anyone else in the world, doing the exact same job he/she is doing and then can take what he/she made and buy some rice at the same price ( all shipping handling for entire world is  priced in ) with that same universal currency/asset he/she earned there will be no more  poverty anywhere.
This will also give bitcoins/Litecoins value and gold/silver/commodities liquidity and bypass all fiat currencies in the world taking away power from the top 85 families on the planet that have the same assets as the bottom 3.5 billion people. ( and 10's of thousands of others ripping people off everywhere)
This also solves the problem of not much liquidity for the easy transfer and payment using actual pieces of gold/ silver / commodities over the internet ..... now their value is transferable to btc/ltc, which is easily exchanged anywhere for everything starting with the most important thing wages for employment.
The way to move the whole thing forward is a worldwide UMX exchange and hundreds of local smaller ones, (2 companies are even developing cheap satellite coms for bitcoin servers ) for gold and silver weights and commodities , not US dollars, CDN dollars, or any other dollars, to be exchanged/traded for btc/ltc.
You can use small shops everywhere, in small communities, in every country in the world, like a current cash shop, pawn broker, grocer or gold/jewelry dealer that fronts all of the small trading for everyone. So you give them some gold or silver commodities etc and they give you btc/ltc or you give them btc/ltc and they give you gold silver commodities based on current gold/btc exchange rates on the UMX..
All 3 things cant be touched by megalomaniacs and are outside of "world money regulation/phantom creation" BTC and even LTC is the same as precious metals in many ways, it has a finite amount available over time, cannot be "printed" into oblivion, must be mined and is a store of wealth and no one individual or group owns the system, it belongs to everyone. The numbers make sense..if you look at fractional bitcoin system the numbers more then make sense... each btc can be broken down to units that equal .00000001 so There are really 2,099,999,997,690,000 (just over 2 quadrillion) maximum possible units in the total maximum bitcoin design. The value of "1 BTC" represents 100,000,000 of these. There is only around an actual 1 trillion in printed usd $ around and currently 60+ trillion in total US debt http://www.usdebtclock.org/ (not including unfunded liabilities ) So there is, or will be by the year 2140 (end of bitcoin mining), 2000 times more exchangeable bitcoin units then us$ in the world and then there are no more BTC.
Mbtc (1/1000 of a BTC has already shown up on hundreds of sites, including redit where people are tipping others for good ideas, music etc. via phones or comps...
As more gold mined down the road it will just change the exchange value slightly ..but,unlike "make believe" money, (only .52% of the Bank of Canada's money is real, 1.75%in at the Fed and the average is .75% in all the central European banks ) .....both gold/silver and bitcoins/silver/commodities have physical limits on total in existence and are very real.
It will lead to all the regular people all over the world getting paid at the same world rate for their labor and buying food etc at also the same world rate, and not an artificial slave rate, dictated by some country leader who is skimming off the top.
Whats going on right now will amaze you if you are not keeping up...

Sat, 05/03/2014 - 19:11 | 4724672 spine001
spine001's picture

What you say is true, but few understand it. It will take a couple of generations to develop, you are being idelistic assuming it will happen in your lifetime. But, your idealism doesn't mean we should not support its progress. I support it and will do so for as long as I breathe. But don't bother to push for understanding. Only experiences will create it and that takes time.

Sat, 05/03/2014 - 15:36 | 4724283 Red Lenin
Red Lenin's picture

It wasn't Marxism that failed.   It was the people that put it in place.

Sat, 05/03/2014 - 15:56 | 4724316 IridiumRebel
IridiumRebel's picture

Marxism does not take into consideration the basic tenet of human desire for achivement. As much as they try to extinguish this simple fact of our inherent nature, it will always fail regardless of who implements it. Humans desire. That will never cease. Hence, a system that works off of human complacency will always fail. The Chinese that worked fields for Mao would wait for "the boss" to pass and then they would sit down and look at the sun. Millions died from this shitty system and Marx was a lazy POS who lived off of others so he could write and let his children starve. FUCKING FACT.

Sat, 05/03/2014 - 16:35 | 4724403 mjcOH1
mjcOH1's picture

"It wasn't Marxism that failed.   It was the people that put it in place."

 

When you base a political philosophy on sloth, envy, and the desire for a free lunch with no effort, what could possibly go wrong?

Sat, 05/03/2014 - 16:06 | 4724340 Cloud9.5
Cloud9.5's picture

That's the same reason the Ghost Dance failed.  Some Indians failed to dance and the Great Spirit did not open the ground and send back the dead braves and  replenish the herds of buffalo.

Note: This is the excuse always given for all failed religions.  Not enough true believers.

Sun, 05/04/2014 - 01:16 | 4725286 Oh regional Indian
Oh regional Indian's picture

Brilliant observation...

Sun, 05/04/2014 - 15:06 | 4726311 malek
malek's picture

Exactly! Every failed idea would have worked, if the people/nature/laws of physics would have behaved accordingly.

Only one solution to that: break the people/nature/laws of physics.

Please go kill yourself.

Sat, 05/03/2014 - 15:43 | 4724294 kchrisc
kchrisc's picture

Marxism/Communism is, like Keynesianism, just intellectual cover for theft and criminality. The mindblowing thing is that people continue to by into this crap instead of Liberty, as in "leave me the fuck alone."

 

Sat, 05/03/2014 - 17:48 | 4724553 Marco
Marco's picture

I can't leave you alone, we share the earth ... an earth far too highly populated to be able to just avoid eachother.

Sat, 05/03/2014 - 15:44 | 4724298 kchrisc
kchrisc's picture

By the way, Marx was a lazy 'tribe' member that wrote all of his screeds to justify his laziness.

So adherents of Marxism that think that it will "pull them out of poverty" are ignorant that it really is a justification for laziness. LOL

Sat, 05/03/2014 - 15:50 | 4724308 IridiumRebel
IridiumRebel's picture

Capitalism works....crony capitalism via a coporatacracy does not work.

Sun, 05/04/2014 - 04:24 | 4725406 Which is worse ...
Which is worse - bankers or terrorists's picture

Please kindly explain how one does not lead to another in a world where if a corporation does not like a law, they just move to another country. 

Sun, 05/04/2014 - 17:16 | 4726597 kchrisc
kchrisc's picture

"Please kindly explain how one does not lead to another in a world where if a corporation does not like a law, they just move to another country. "

I can answer that with one word: "No."

Just subscribe to Life, Liberty and Property and non-aggression against others' Life, liberty and Property and expect the same. Then when anyone or anything comes that threatens to aggress against you or your neighbor, tell them, or it, "no." If they keep coming, let your AK or AR tell them "no."

That was the message so well displayed at the Bundy ranch: "No."

 

"As children we are trained to refrain from using the word "no." As adults that behavior makes us children."

Sat, 05/03/2014 - 15:53 | 4724312 Caviar Emptor
Caviar Emptor's picture

Can the American heart stand the shocking fact about the death of middle class life?
Can we live without aspirational consumerism as the central purpose of American life?
The agonizing death of the yuppie will be a tough pill to swallow for the masses. Trading in that Armani suit for a butler's jacket will break their hearts and wound their soul.

Sat, 05/03/2014 - 18:21 | 4724605 Everybodys All ...
Everybodys All American's picture

Who in their right mind would trade in the middle class lifestyle Americans have enjoyed for decades for the failed policies of socialism. Answer : Today's democrats and progressive republicans.

Sat, 05/03/2014 - 15:52 | 4724313 Alethian
Alethian's picture

For fuck sake. This shit again?

Sat, 05/03/2014 - 16:19 | 4724319 deflator
deflator's picture

It doesn't matter what form of government as long as the citizens are righteous. If citizens are corrupt then they will be governed by corruption.

 

 I think if the majority of citizens were righteously enlightened then a bottom up form of government would be ideal. For thousands of years humans continue to cry out, not for self governance but for kings and judges.

 

 China and the Soviet Union are characterized as bottom up forms of government where ironically their failing was humongous centralized governance.

 If all the "money" gets funneled through a small centralized group of individuals it is human nature that they will rationalize keeping all of it for themselves.

 Accounting is only a waste of time if there is trust.

Sat, 05/03/2014 - 16:38 | 4724410 SDShack
SDShack's picture

"For thousands of years humans continue to cry out, not for self governance but for kings and judges."

That's why I say Hope & Change was really designed as Hoax & Chains. Sadly, the masses bought it... twice.

Sat, 05/03/2014 - 15:59 | 4724328 JR
JR's picture

Piketty, who’s taken over Number 1 on the book charts in his resurgence of Marx’s Das Kapital to the thrill of the Leftists, has created a type of cheering section for the welfare society, using a sort of word game. And, as we now know, words are like different colored shiny rocks. They mean only what the speaker chooses them to mean (translation: nothing).

In the 30s, Stuart Chase nailed just how worthless and how dangerous the term “capitalism” is and its use by those economists and bankers who seek to confuse and dominate a discussion.

“’Capitalism is thus a shape, a form, which speaks, commands, fights, runs away. Asked to define it, the debater on the left introduces more abstractions. ‘Absentee ownership,’ ‘surplus value,’ ‘class struggle,’ ‘private ownership of the means of production,’ ‘exploitation of the masses,’ ‘imperialism,’ ‘vested interests,’ ‘proletariat,’ ‘bourgeoisie,’  the ‘profit system,’ and many more. The great words roll. The Schoolmen perspired no harder in their Aristotelian squirrel cages. From time to time, the reasoner thrusts a hand into the world outside and seizes a raw, living fact. If it pleases his argument, he hauls it squirming into the cage. If not, he drops it.”

Sat, 05/03/2014 - 16:03 | 4724337 NYPoke
NYPoke's picture

The scam is to promote Communism/Socialism as an alternative to Capitalism, when the same people run all 3.

 

All about centralized power & all 3 have been used to do just that.  Throw in Democracy & you pretty much have all the options you need to abuse the people.

Sat, 05/03/2014 - 16:45 | 4724427 SDShack
SDShack's picture

Sociopaths run ALL the systems. The only way to stop a sociopath, absent violent revolution, is the uniform judicial application of the rule of law. Left to their own devices, a sociopath will twist all law to their benefit at the expense of the masses. What you end up with is a rule of law for the masses only, that is separate and completely different from the rule of law for the elites. That is the Feudal World Order, and it is rapidly becoming the New Feudal World Order today. For a society to function for the benefit of all, ALL must be subject to the same enforcement of the rule of law... the masses and the leaders. There can be no double standards. 

Sun, 05/04/2014 - 15:10 | 4726317 malek
malek's picture

Well said.

One thing I would add is violent revolution in the end almost always leaves you only with a different breed of sociopaths.

Sat, 05/03/2014 - 16:05 | 4724339 jabhagsb
jabhagsb's picture

1) You can’t eliminate ownership of property. If it exists, someone has to own it.

Rubbish. Property can exist without ownership. This type of statement shows the extent of the author's brainwashing by those that own the printing presses and wish to own everything else. It can possibly exist without ownership and by the way, we will print up all of the money necessary to own it.  Thank you.  

 

Sat, 05/03/2014 - 17:08 | 4724462 Cloud9.5
Cloud9.5's picture

 

Consider Zimbabwe.  Mugabe and his tribe came in and seized the property of the White tribe. So good so far. In every conflict there are winners and losers.  The problem is that he did not stop there.  He introduced a thugocracy.  A lower ranking thug found out real quick that his new found property could be seized by a higher ranking thug.  Have a nice beamer and a higher ranking thug takes it away from you.  The only way to have a car was to have a beater that nobody wanted to steal.  Get the farm going, repair the pumps, get the irrigation up and running and produce a crop what happens?  A higher ranking thug takes it away from you.  End result: one of the most productive nations in Africa can’t feed itself. What follows next?   Currency collapse.

Sat, 05/03/2014 - 16:07 | 4724341 debtor of last ...
debtor of last resort's picture

Why do they always talk about the stock, and not about the flow?

A two-tier system is needed, sustenance economy next to a pure capitalist system, funded by the law of communicating barrels.

Sat, 05/03/2014 - 16:21 | 4724369 Hannibal
Hannibal's picture

No such thing as "privately owned property",...you still have to pay a propery (extortion) tax and Govts can evict you any time for any reason with the stroke of a pen (eminent domaine).

You have NO rights!

http://www.columbia.edu/cu/cssn/expansion/infosheets/eminentdomain.pdf

Sat, 05/03/2014 - 16:22 | 4724370 trader1
trader1's picture

the article's author demonstrates a weak understanding of marx and has already made his mind up about things...

So Marx got this right and would be seen as a prophet if he’d stopped there. Unfortunately, he went on to predict that the revolt of the 99% would result in a “dictatorship of the proletariat” in which workers of the world abolished private property and ran things so wisely that government would just fade away.

why is the prediction "unfortunate" regarding a revolt of the 99% that results in a dictatorship of the proletariat, abolishing private property, and government fading away?  

and what is to stay he won't be proved correct?  he certainly has time on his side...

 

and maybe, such a future is just be around the corner (albeit in a modified form)?

 

Sat, 05/03/2014 - 16:28 | 4724383 Nimby
Nimby's picture

Government doesn't exist to protect me from you; it exists to protect you from me.

Sun, 05/04/2014 - 04:12 | 4725397 trader1
trader1's picture

that's an interesting belief system.  how is that one treating ya?

i tend to believe we are all one.

Sat, 05/03/2014 - 16:24 | 4724373 Amish Hacker
Amish Hacker's picture

The other thing Marx got spectacularly wrong, imo, is he predicted that communism would be created by the "workers of the world," i.e. the industrial workers. But the only countries that have tried Marxism ( USSR, China, Cuba, etc.) have been agrarian economies/societies.

Sat, 05/03/2014 - 16:25 | 4724375 Idleproc
Idleproc's picture

Imbecile. You have not read and understood Marx.
Marx said of eliminating private ownership of the means of production, not the individual.
Lobby and global corporations threaten the ass.
The Communist attempt ended in the '20s with the Stalinist counter-revolution of criminals.
Stalin's communists killed them all, the last one was Trotsky.
I am not communist, but so read the story.

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