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necessary on an average for their production. But of this value the labourer gets an amount sufficient only to meet the contemporary cost of producing and maintaining his labour-power—i.e., a living or subsistence wage. All the rest is surplus value, and goes to the capitalist. Capital lives by collecting surplus value, or, in other words, by appropriating for itself the difference between the value of the goods produced by the social labour of many and the cost of purchasing that labour.
The Fall of the Bourgeoisie. From his analysis of capitalism Marx went on to show that there were inherent weaknesses or contradictions in the system which would eventually and inevitably cause its death. The symptoms were many. (1) The concentration of capital into fewer bigger piles. The Industrial Revolution had deprived many small capitalists of their independence, and, as the new system developed, big units would swallow up or kill small ones. Small production or exchange was doomed, and the big units would grow fewer and bigger, whilst the smaller and middle-sized capitalists were driven by competition down into the proletariat. “One capitalist always kills many''; with the “constantly diminishing number of the magnates of capital," and the growth of the joint stock company and trust the whole economic life of continents, if not of the world, would pass under the control of a few multi-millionaires. Such a condition, where the millions were at the mercy of the few, would inevitably lead to revolt. The revolt would be hastened when the many saw that the few were really unnecessary to production. With the growth of joint stock companies, actual management of industry passed into the hands of paid agents, managing directors and the like. The owners of capital, the appropriators of profit, had then nothing to do with production; they became the "idle rich,,"". pocketing dividends, tearing off coupons, and then spending hard.
(2) The increasing misery of the proletariat. This would be due to many causes. The constant drip of people from the class of small independent producers or tradesmen, the displacement of men by women and children, and the abolition of skill from machine industry would all help to intensify competition amongst wage-earners and keep the industrial reserve army of unemployed at full strength. Hence wages would tend to become level, and the level would be low. Trade unions might occasionally be victorious in their efforts, “but only for a time.” Accumulation of wealth at one pole would be accompanied by “accumulation of misery, agony of toil, slavery, ignorance, brutality, mental degradation at the other pole.' Every reduction in the cost of staple commodities means å reduction in the cost of living, and therefore the subsistence wage can be pushed lower. This misery is accentuated by the frequent crises and depressions, which are due to the inability of the poorly-paid labourers to purchase the goods they produce, and to the anarchy of competitive industry. Hence the modern labourer “instead of rising with the progress of industry sinks deeper and deeper below the conditions of existence of his own class. He becomes a pauper, and pauperism develops more rapidly than population and wealth. The bourgeoisie, therefore, “is. unfit to rule because it is incompetent to assure an existence to its slave within its slavery, because it cannot help letting him sink into such a state that it has to feed him, instead of being fed by him."
(3) The persistent recurrence of crises and depressions. Marx regarded crises as due to the inability of the market to keep pace with the growth of production. New capital seeking for profits, rushed into production. But the new goods . could not find a market, especially since the
producers had received insufficient wages to enable them to absorb the commodities. Hence came over-production, with industrial and financial stagnation, until the surplus had been disposed of. These depressions seemed to be growing more severe, and possibly more frequent. They showed the inherent anarchy of the capitalist system, and some day one of them might bring the whole economic order down in ruins.
(4) The growing conscious strength of the proletariat. Capitalist industry has gathered men together, taught them how to work together, given them a sense of class kinship, inflicted on them common injuries. In its political fights the bourgeoisie has sometimes sought their aid, and thus given them not merely a vote but some experience of political affairs. Hence while capitalism is travelling on its destined path towards destruction, its slaves are learning the lessons necessary for freedom. When the great day comes, therefore, the proletariat will be ready to give the final push which will send private ownership and appropriation crashing down among the debris of earlier systems.
The Social Revolution. When and how will the transition take place? Not till all is fully ready, and capitalism has developed in the ways outlined above. There can be no hastening the day, for "no social order disappears before all the productive forces for which there is room in it have been developed; and new higher relations of production never appear before the material conditions of their existence have matured within the womb of the old society." What would happen on the day of revolution Marx and Engels could scarcely say, except in vague phrases. The Manifesto spoke of the time when the veiled class war would "break out into open revolution” and the "violent overthrow of the bourgeoisie lay the foundation for the sway of the proletariat.” The first phase in the revolution was “to raise the proletariat to the position of the ruling class, to win the battle of democracy." The battle might entail barricades, bloodshed, and terror, for Marx did not expect the bourgeoisie, even in England, to surrender without a fight of some sort. Having won its fight, the proletariat would use its political power “to wrest by degrees all capital from the bourgeoisie, to centralize all instruments of production in the hands of the state, and to increase the total of productive forces 28 rapidly as possible.” Thirty years later Engels said no nation would put up with production controlled by trusts, and the state would ultimately have to intervene. Beyond this will come a time when the proletariat seizes political power and turns the means of production into state property." Marx satisfied himself in “Capital” with a sentence which may mean anything: “Centralization of the means of production and socialization of labour at last reach a point where they become incompatible with their capitalist integument. This integument is bursť asunder. The knell of capitalist private property sounds. The expropriators are expropriated.” But the question is not really important. What really matters is that the bursting asunder is inevitable. Given certain tendencies inherent in capitalist society, the great day must come sooner or later. There is no preventing it.
Comments. The Marxian system made claim to be scientific; it laid down certain economic laws, some of which governed all recorded history, while others applied only to modern capitalist society. These laws were all-powerful; they worked and would work with the force and certainty of the laws of gravitation. In places Marx was just as abstract, just as dogmatic, just as enamoured of imaginary conditions and illustrations as
Ricardo and the old school of “vulgar economists." But he embodied in his work a lot of historical and statistical material, which was intended to support his conclusions; he had an eye for the gruesome, and collected from the newspapers and official documents of the first 65 years of the century all the harrowing tit-bits of working-class sufferings.
Although capitalism has produced many evils, there is no real moral condemnation of it in Marx. All thoughts of idealism, all notions of justice, fair play, altruism, or fraternity are ruled out of the discussion and left for the Utopians to dabble in. The question is not “What ought to be?” but “What is and what is likely to be?” Socialism will come, not because it is a just form of society, but only because it is an inevitable development from capitalism. Therefore when analysing bourgeois society no condemnation of the individual capitalist is implied; he acts as he does because the system will not let him act otherwise. Increasing misery, the destruction of the middle class, the concentration of capital, the recurrence of crises, all are described, but not denounced on ethical grounds. If capital is a vampire which lives “by sucking living labour,” well, it is the system which makes it so, and capital and labour alike are under the sway of the inexorable economic laws. Marxian Socialism was essentially a working-class gospel.
The Utopians had welcomed men of all classes, and had sought to convert the wealthy and educated. But the establishment of scientific socialism was to be the work of the proletariat alone; "the proletariat alone is a really revolutionary class." True, entire sections of the ruling class would by the growth of big business be precipitated into the wage-earning class, or be seriously threatened with such a fate, and when “the day" drew near the more idealistic section of the bourgeoisie would cut itself adrift and join the revolutionary class. But such influx would be small; the "intellectuals” could have little influence, and the fight must be fought and won by the proletariat.
Criticisms. Since Marx's death his writings have been the subject of most intensive examination and criticism, so that to-day there is a vast literature attacking or defending his theses and theories. What Marx said, what he did not say, what he meant, and what he did not mean are topics around which violent controversies have raged-and still rage. The critics are not all anti-socialists or “bourgeois professors”; some of them live in the socialist fold. In 1897 Edward Bernstein, a veteran of German Social Democracy, published a volume urging the revision of the Marxian teachings in the light of recent discussions and developments: he pointed out that Marx the prophet had not been a true prophet, and that therefore his forecasts about the inevitable overthrow must be revised. This heresy brought forth vigorous assertions of Marx's wonderful foresight and accuracy, and so the controversy blazes still; orthodox Marxism finds champions, especially among Bolsheviks in Russia and left-wing socialists in America and Australia. The revisionists and critics are legion; so are the orthodox. Meanwhile the Marxian tenets, being excellent food for revolutionary temperaments, are eagerly devoured by many socialists in spite of all the critics' assertions that the food is bad and indigestible.
To enter fully into a discussion of the rightness or wrongness of Marxism is a task too big for this volume, but the main lines of criticism can be summarized point by point. Those who wish to pursue the matter further must consult the books mentioned at the end of the chapter.
(1) The Economic Interpretation of history in its crude form with the prevailing mode of production and exchange and the social organization built thereon as the factor by which alone can be explained the political and intellectual history of the epoch, does not stand the test of historical or social analysis. Late in life Engels denied that he had wished to rule out other forces, and said, “We did not always have the time, place, or opportunity to let the other factors which were concerned in the mutual action and reaction get their deserts.” In 1895 he conceded that while political, legal, philosophical, religious, literary and artistic developments rested on the economic foundation, “they react upon each other and upon the economic basis." Marx in his third volume pointed out that the economic basis of society in all its essentials might show “in actual life endless variations and gradations due to various empirical facts, natural conditions, racial relations, and external historical influences without number." Modified and watered down like this, the theory comes nearer the truth, which probably is that social structure and growth are determined by the working of many forces, of which the economic is an important one-at times the most important—but not the only one. Marx rendered a great service to mankind by making us realize this truth: he helped to revolutionize historical and economic study. History has had to be re-written: economic history has become one of the most important branches of historical teaching: floods of new light have been thrown on old problems. The modern historian has to show the interplay of economic, legal, political, racial, and spiritual forces, and he can no more ignore the economic factor than the socialist can ignore the non-economic.
(2) The Class Struggle doctrine, resting on the economic interpretation of history, found all history was the story of struggle between economic classes about economic issues. The watering down of the economic interpretation theory entails the modification of the class struggle view of history, for if non-economic factors count, then non-economic factors may be the cause of conflict. There is a division of interests between bourgeois and proletarian, especially on the question of wealth distribution; but it is not the only division of interests, it is not the only economic division, and it does not exclude possible unity on religious, national, or racial issues. The struggle between capital and labour is not the class struggle; it is a class struggle, one of many tugs-of-war in society, and there are issues which either divide society across the lines of class, or bind all together regardless of class. For instance, rich and poor persist in attending the same church, and join hands over any sectarian issue; wage-earners fight side by side with landlords and capitalists in defence of the fatherland; German Social Democrats, after 50 years of Marxism, rallied to protect themselves—and incidentally the bourgeoisie—against Czarism in 1914; six years later the Russian bourgeoisie apparently gathered round the Bolsheviks to protect the country they loved—and, incidentally, the system they hated—against Allied intervention and White Guards. In economics there is a clash between labourer and capitalist; but there is also conflict between capitalist and capitalist, between producer and consumer, between rival groups of producers, between producer and financier, transporter, or middlemen, between wholesaler and retailer, between importer and local manufacturer. In the ranks of labour skilled men look down on unskilled, clerks on manual workers, foremen on subordinates, men on women, white workers on coloured. Then there is the struggle of rival ideas and ideals, which makes solidarity almost impossible. The socialist has little affection for the labourite, the
syndicalist for the socialist, the Marxian for the revisionist or utopian, th? Bolshevik for the Menshevik, the active minority for the apathetic majority. Thus, to sum up, the struggle between capital and labour is only one partan important part—of the general clash of ideas and interests in society. The class struggle and the economic interpretation of history are only true if we accept the doctrine that "economic man” is the whole of man.
(3) The concentration of production in a few big units, and of capital in the hands of a few big magnates, was the vertebral column of Marx's explanation of the coming of socialism. In some directions the actual developments have probably exceeded his expectations. The large firin, employing thousands or tens of thousands, is a common feature of industrial life to-day. The trust has brought scores of establishments under central control. But while the big firms have grown in size and number, the middlesized and small ones are far from being crushed out of existence. Instead they increase in number as rapidly as the population. They may be partly dependent on the bigger places; they may have to struggle hard in bad times;
but they persist in multiplying. In them the personal interest and alertness of the owner-manager compensates to some extent for the loss of the economies of large-scale production, and it is possible that these economies may diminish as big concerns get too big to manage and sink into routine methods.
In agriculture Marx's prediction about concentration was completely falsified. Arguing from his knowledge of English conditions, where the small farmer had largely disappeared, Marx confidently expected similar developments everywhere else as a result of the introduction of machinery. In this the wish was father to the thought, for not only could there be no complete social revolution so long as the ownership of land was widely scattered, but Marx knew that the small landowners would be the most bitter enemies of socialism. Therefore, let them be crushed; it would be unpleasant, but good for the development of the antagonism essential to the success of the class struggle. Marx knew little about farming; therefore he did not realize that machinery plays a much less important part in cultivation than in manufacture. Science rather than machinery is the keynote of modern agriculture; rotation of crops, the use of fertilizers, careful breeding, hoeing, pruning, irrigating, etc., all can be availed of by the small man almost as well as the big one. Hence the peasants have given the lie to Marx's prophecy. Everywhere, even in England in recent years, the trend has been towards small holdings and more intense cultivation. This applies not merely to old lands, where many big estates have been subdivided, but also to new countries. Cultivation and ownership go together in the great bulk of these small farms. Faced with these facts, the Marxian apologist points to the mortgages on the peasant properties, or to the fact that the farmers are dependent on the rail, elevator, and shipping capitalists, and the middlemen for the disposal of their goods. But the mortgage is often a stepping-stone by which the man of small capital is enabled to get access to land, work it, and so reach independence; it ceases to be a terror with the development of co-operative credit banks. Co-operation can dispense with privately-owned storehouses, factories, and domineering middlemen; `private ownership of railways is confined to very few countries, whilst co-operation or state ownership can reduce the shipping freight question to smaller dimensions.
With the growth of big industrial units Marx associated the concentration of wealth in the hands of a few, and the extinction of the middle class.