The crimes we shall expose are to be judged not by the standards of Communist regimes, but by the unwritten code of the natural laws of humanity.
Stéphane Courtois [The Black Book of Communism, Crimes, Terror, Repression, with Nicolas Werth, Jean-Jouis Panné, Andrzej Paczkowski, Karel Bartoshek, and Jean-Louis Margolin, translated by Jonathan Murphy and Mark Kramer, Harvard University Press, 1999, p.3]
It is better to kill one hundred innocents than to let one guilty person go.
Dolores Ibarruri ("La Pasionaria"), Spanish Communist [ibid., p. 343]
We didn't kill enough people.... Revolutions succeed only when rivers run red with blood, and blood has to be spilled if what you are aiming for is the perfectibility of the human race.
Ares Velouchiotes, Greek Communist, [ibid., p. 329]
Communism is not a reaction against the failure of the nineteenth century to organize optimal economic output. It is a reaction against its comparative success. It is a protest against the emptiness of economic welfare, an appeal to the ascetic in us all... The idealistic youth play with Communism because it is the only spiritual appeal which feels to them contemporary.
John Maynard Keynes, 1934
Germany today is, next to Russia, the greatest exemplar of Marxian socialism in the world.
W.E.B. Du Bois, 1936
It is no defence whatever for an intellectual to say that he was duped [by Communism], since that is what, as an intellectual, he should never allow to happen to him.
Oddly enough, it is the intellectual snobbery and elitism of many of the literati that politically correct egalitarianism appeals to; their partiality to literary Marxism is based not on its economic theory but on its hostility to business and the middle class. The character of this anti-bourgeois sentiment therefore has more in common with its origin in aristocratic disdain for the lower orders than with egalitarianism.
John M. Ellis, Literature Lost [Yale University Press, 1997, p. 214]
The almost universal disdain toward the middle class -- the bourgeoisie -- by those with cosmic visions can be more readily understood in light of the role of such visions as personal gratification and personal license. The middle classes have been classically people of rules, traditions, and self-discipline, to a far greater extent than the underclass below them or the wealthy and aristocratic classes above them. While the underclass pay the price of not having the self-discipline of the bourgeoisie -- in many ways, ranging from poverty to imprisonment -- the truly wealthy and powerful can often disregard the rules, including laws, without paying the consequences. Those with cosmic visions that seek escape from social constraints regarded as arbitrary, rather than inherent, tend to romanticize the unruliness of the underclass and the sense of being above the rules found among the elite.
Thomas Sowell, The Quest for Cosmic Justice [The Free Press, 1999, pp. 139-140]
Many whose allegiance went to the Soviet Union may well be seen as traitors to their countries, and to the democratic culture. But their profounder fault was more basic still. Seeing themselves as independent brains, making their choices as thinking beings, they ignored their own criteria. They did not examine the multifarious evidence, already available in the 1930s, on the realities of the Communist regimes. That is to say, they were traitors to the human mind, to thought itself.
Robert Conquest, Reflections on a Ravaged Century [W.W. Norton & Compnay, 2000, p.118]
As an intellectual construct, Capital was a masterpiece. But, like some other intellectual masterpieces, it was an elaborately sophisticated structure erected on the foundation of a primitive misconception.
...In the realm of ideas in general, the Marxian vision -- including his theory of history -- has not only dominated various fields at various times, it has survived both the continuing prosperity of capitalism and the economic debacles of socialism. It has become axiomatic among sections of the intelligentsia, impervious to the corrosive effects of evidence or logic.
But what did Marx contribute to economics? Contributions depend not only on what was offered but also on what was accepted, and there is no major premise, doctrine, or tool of analysis in economics today that derived from the writings of Karl Marx. There is no need to deny that Marx was in many ways a major historic figure of the nineteenth century, whose long shadow still falls across the world of the twenty-first century. Yet, jarring as the phrase may be, from the standpoint of the economics profession Marx was, as Professor Paul Samuelson called him, "a minor post-Ricardian."
Thomas Sowell, On Classical Economics [Yale, 2006, p.184-186], boldface added
It deserves mention however that, as Joachim Reig has pointed out (in his Introduction to the Spanish translation of E. von Böhm-Bawerk's essay on Marx's theory of exploitation (1976)), it would seem that after learning of the works of Jevons and Menger [i.e. the "marginalist" revolution], Karl Marx himself completely abandoned further work on capital. If so, his followers were evidently not so wise as he.
F.A. Hayek, The Fatal Conceit, The Errors of Socialism [1988, The University of Chicago Press, 1989, 1991, p.150]
The destructive work of totalitarian machinery, whether or not this word is used, is usually supported by a special kind of primitive social philosophy. It proclaims not only that the common good of 'society' has priority over the interests of individuals, but that the very existence of individuals as persons is reducible to the existence of the social 'whole'; in other words, personal existence is, in a strange sense, unreal. This is a convenient foundation for any ideology of slavery.
Leszek Koakowski (1927-2009), "Totalitarianism and the Virtue of the Lie," Is God Happy? Selected Essays [Basic Books, 2013, p.57] (cf. Hegel on the ontological unreality of individuals)
That Marx is worth reading is certain. The question is, however, whether his theory truly explains anything in our world, and whether it provides grounds for any predictions. The answer is no. Another question is whether or not his theories were ever useful. Here the answer is, obviously, yes; they operated successfully as a set of dogmas that were supposed to justify and glorify communism and the slavery that inevitably goes with it.
Leszek Koakowski (1927-2009), "What is Left of Socialism?" Is God Happy? Selected Essays [Basic Books, 2013, p.64]
English Department Marxists see political economy as a morality tale. Capitalists are wicked. This is not Marxism. The form of economic activity in Marx is determined by the material conditions of production, regardless of the will, intentions, or goodness of the economic participants. Only when those conditions change can the mode of production change.
Were we directed from Washington when to sow, and when to reap, we should soon want bread.
Thomas Jefferson, Autobiography
LASCIATE OGNE SPERANZA, VOI CH'INTRATE
Dante Allighieri, The Divine Comedy, Inferno, III:9 ["Abandon every hope, you who enter"]
It is a fundamental principle, if not an axiom, of Marxism that capital is a fiction and only exists as an illegitimate and parasitic phenomenon, which alienates from the workers part of the value created by labor. This is why Capitalism is called "Capitalism" and Marx's book about it Das Kapital. However, Marx's own system contains a feature that can only be understood as reflecting the reality of capital. As Marx allowed, indeed celebrated, that over time the material conditions and mode of production change and improve, representing the economic progress of history, he overlooked the circumstance that this progress must then be ranked according to a system and scale of value. The quantity of labor may not change, but what it can produce, in quantity and quality, does.
Thus, the vast number of Egyptian masons and other laborers who could produce a pyramid, an essentially useless object, would now be put to better use producing the consumer and capital goods of an industrial economy. The difference in productivity between the pyramid builders and automobile makers is covered by Marx with a version of Hegel's dialectic, which is supposed to produce ever more complex and sophisticated structures with each iteration. Be that as it may, this effectively introduces a new variable into the equation of value. A quantity of automobile labor differs in a different dimension of value from an equal quantity of pyramid labor. Nothing prevents Marx from identifying such a scale in the dimension of dialectical progression. However, there is already a name for such a scale of value: It is the value of capital, including human capital.
Pyramid building is labor intensive production, while automobile building is capital intensive production. Capital intensive production requires skills and knowledge, whose fruits may be effected by the industrial workers, but which may only be conceived and held systematically in the consciousness of the industralist, i.e. the Henry Ford. Yet even the level of capital development represented by pyramid building, whose products remain marvels of human achievement (at least for their audacity, scale, technical achievement, and durability -- not unlike the Eiffel Tower), is historically credited to one genius, the semi-divine III Dynasty architect Imhotep. Marx's denial of the existence and necessity of capital means that his own theory is incoherent, since it denies but does actually contain a scale of value, which we can now recognize as that of capital, to explain improved modes of production, increased productivity, and more technologically and aesthetically sophisticated products. His entire theory of the historical dialectic of class struggle depends on this, and yet it is simultaneously refuted by it. In order to disparage the success of capitalism, modern Marxists are reduced to anhedonic and anaesthetic condemnations of "consumerism," recycling moralistic arguments originated by Plato.
Karl Marx (1818-1883) did not have a theory of morality; he had a theory of history. Thus, Marxism was not about right or wrong but about what will happen in history. Marx was contemptuous of people who judged things in moral terms. When diehards say that Marxism has actually never been "tried" (despite what Lenin, Stalin, Mao, Castro, Ho, and Daniel Ortega thought they were doing), they don't understand that Marxism was not a rule for behavior or a program for action; it was supposed to be the theory of a deterministic mechanism that will produce the future, a theory of actions that will arise spontaneously because of historical circumstances -- although we can infer what kinds of actions people, including ourselves, will be taking -- after all, Marx said that the purpose of his work was to change the world, not just understand it. It is the theory, however, the world will change because of the objective economic conditions, not because of some decisions we make. This was not a theory about "human nature" or "human psychology," but about how the mode of economic production (how goods and services are produced) determines all the other political, social, cultural, and moral structures of a society (though some Marxists are uncomfortable with this in an absolute sense). The needs of the "English petty bourgeois" are thus not "false needs", however dismissive Marx sounds, but true needs in relation to a capitalistic mode of production -- needs which will change over time, in a historicist sense, as the mode of production changes [note]. As a "science" of history, Marxism would succeed or fail to the extent that it could actually predict the evolution of production and its various effects.
Marx thought that as capitalism had replaced feudalism with a new mode of production, which was more productive and efficient, the same thing would happen to produce a replacement for capitalism. In the end, as the workers were impoverished (when capitalists drove down wages) and the number of capitalists dwindled (as competition was replaced by larger and larger monopolies), the capitalists would end up with no one to sell their goods to and nothing to do with the capital derived from their profits. This would produce increasingly severe credit and banking crises, until the proletariat would easily tip over the whole rotten structure and replace it with a classless society.
Centralisation of the means of production and socialisation of labour at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. [Capital, Vol. I, p.837, Charles H. Kerr & Co., Chicago, 1906, translation by Edward Aveling, quoted by Thomas Sowell, On Classical Economics, Yale, 2006, p.170]
Already in this we find the essence of the fallacy of Marxist economics. Marx believes that as the dialectic of history evolves new modes of production, greater productivity and greater wealth will be created, ultimately eliminating the need for alienated and exploited labor. However, there is not a variable in Marxist value theory to account for greater productivity. If labor (or "socialy necessary" labor) creates value, then a greater quantity of labor will create greater value, but only in quantity, not in kind. More labor for pyramid building just builds more pyramids. Thus, some other variable is involved besides labor. In fact, that is capital. Labor intensive production gives way to capital intensive production, and greater capital means great productivity, not just in quantity, but in kind. But Marx does not believe that capital exists, which is why capitalism is called "capitalism." This means that Marxism cannot explain increased productivity. And then Marxism also contains another trend disparaging to productivity as such. Jack London, less well remembered now as a communist than as an author, said that a worker who is more productive than others "is already a scab," i.e. a strike breaker. Thus, the view seems to be that increases in productivity are part of the exploitation of labor.
Unfortunately, without such increases, 90% of labor would still be involved in agricultural production, while in the United States that is now less than 2% of labor, the rest of which goes into producing other things. Those "other things" are what pose the problem for an economic system like Marxism. Since British industry was largely involved in building railroads in Marx's day, he seems to have actually believed that, once the railroads were built, there would be nothing for that workforce, or its capital, to do. But this is the key to the whole meaning of capital. Capital is knowledge. Capital is imagination. Capital investment may be thought of as the construction of machinery, but the machinery, with its use and purpose, must first be conceived. The new purposes require that new products be thought of. But then with the conception of new products, new uses, and new purposes, the machinery may only be one element, or no element, in it. Simply a different way of doing things represents new knowledge and new capital. Thus, we have idea in modern economics of "human capital," where some people simply know how to do things better than others. Also, the value of capital can simply evaporate in misconceived investments. "What is sunk is sunk," is the principle: bad investments, into which capital has been sunk, must at some point be written off. It is "sunk."
Marx's thesis of the fictional nature of capital is thus equivalent to his lack of imagination regarding what it would be possible for people to do with their capital. That entirely new products and industries could be conjured up, to be brought to life with capital investment, was a process that was simply off the radar of Marxist economics. Perhaps he thought that the unexploited workers would sit down one day and simply begin producing cell phones, with the conception perhaps spontaneously coughed up by the Hegelian dialectic. No. Since Marx was the kind of person who would never know what to do with capital, he did not believe there was anything to do with it. This is a common state of mind, and it is still about the level of economic understanding of much modern political discourse. It is worse with human capital. The tradition of many people, often ethnic minorities, in starting and running small businesses, which represents a profound body of knowledge, more easily learned at one's mother's knee, next to the cash register, than even in business school, elicits from the Marxist only suspicion, condemnation, and hatred. The people who typically run small businesses, we know, like the Jews, together with the Chinese in Southeast Asia, Indians in Africa (or the neighborhood Seven Eleven), or Koreans in Harlem, are simply engaged in small scale capitalist exploitation -- they are the "petty bourgeoisie" who will be eaten up by growing monopolies. For the enlightened, the bien pensants, they merit only contempt. The idea that they are the source, not only of economic success for minorities or individuals, but of revolutions in production for the economy as a whole, where both the Ford Motor Company and Apple Computer started in someone's garage, is only met with dumb incomprehension and incredulity -- even from people whose own family, as with many Jews, contains just such a history of innovation and success from small roots.
Thus, since Marx did not believe in capital and did not understand the sources of innovation and invention, the elimination of small business and small entrepreneurs by monopoly capital was not only expected but was regarded as a desireable feature of the process. With surviving employed labor concentrated in large corporate entities, and the capitalists left with nothing to do with their capital and few consumers with the means to purchase capitalist production (given vast unemployment and employed workers paid only subsistence wages), the revolution would more or less happen of itself when the system collapsed in a panic of banks and investors. History would thus flow in the following way:
However, although nominal wages were falling in the United States from 1865-1897, apparently in line with Marxist expectations, real wages were actually rising, and there didn't seem to be a problem with over-production or with capital investment. Marx's own data showed rising real wages, as in Britain they rose by 80 percent in the last half of the 19th century. Recognizing that things weren't going as predicted, Lenin (Vladimir Ulyanov, 1870-1924) proposed that colonialism and imperialism were relieving the stress on capitalism and had temporarily derailed history: Colonies were a safety valve for excess capital and over-production; and the exploitation of colonies enabled the capitalists to buy off the proletariat at home. But Lenin's own data showed that most foreign investment was in other capitalist countries, and it is hard to imagine how an impoverished colonial population could buy things that the proletariat back home couldn't afford. Nevertheless, Lenin's theory at least addressed the issue. He therefore saw the flow of history in these terms:
When the Russian Revolution came, Lenin and his colleagues had to address the paradox that according to orthodox Marxism Russia was not ready for a real communist revolution, since it had never passed through the necessary stage of capitalism itself. Although developing quickly enough, and the fourth largest economy in the world in 1914 just because of its size (it had been the largest through much of the 19th century), Russia was still largely a feudal society. Lenin died before much sense could be made of the situation, especially when his programs caused the economy to collapse and he had to retreat from an attempt at pure communism into the semi-market economy of the New Economic Policy (the NEP). Subsequently, Stalin (Iosif Dzhugashvili, 1879-1953) followed the principle that the Russian Revolution would substitute a benign replacement for capitalism, namely "socialism," which would do the same job of industrialization without capitalist exploitation. Meanwhile, the new Russian state, the Soviet Union, would fight against imperialism and work for de-colonization and national liberation. If imperialism and colonialism could be ended, then capitalist economies would revert to the dynamic described by Marx and communism would develop there in the natural way. Stalin thus saw the flow of history in this way:
With the Great Depression, which looked like just the sort of credit and production collapse that Marx had predicted, and which gave many Westerners the impression that Stalin's programs were producing better results in the Soviet Union, things seemed to be getting back on track. Then, when capitalist countries joined in to help defeat what should have been their own best hope, fascism [note], things really started looking up. The post-war world then began to see the start of de-colonization. For fear of "neo-colonialism," newly independent countries were advised to nationalize foreign holdings and limit capitalist exploitation (i.e. foreign investment). Stalin's Five Year Plans were seen by people like the new Prime Minister of India, Jawaharlal Nehru (1889-1964), as the proper way to modernize an economy.
Over the years, however, the countries that took this kind of advice the most seriously experienced only failure and stagnation. Nehru's great plans in fact condemned India to many decades of little improvement in its standard of living. But India was in good shape compared to Africa. By the late 80's, most former African colonies had lapsed into military dictatorships under which the standard of living was actually lower than it had been when they were colonies. All the modernistic and socialistic rhetoric of the original leaders of African independence, like Kwame Nkrumah (1909-1972) in Ghana, had turned out to be nothing but a mask for incompetence, corruption, and naked power. Instead of foreign investment, African leaders demanded foreign aid delivered directly to them. Most of that was either wasted on useless projects or diverted into their own pockets: leading to the bitter characterization of them as "Swiss bank account socialists."
Meanwhile, the once admired economy of the Soviet Union showed what it was truly made of: corruption, inefficiency, and irrationality on a vast scale. Although everyone expected that the Soviet Union's own economic statistics were unreliable, even the CIA greatly overestimated the size of the Soviet economy -- today one even hears the accusation that they did this deliberately to magnify the Soviet threat and perpetuate the Cold War (pursuant to the bureaucratic self-interest of the CIA -- which means that such an accusation could originate either from attacks on capitalism or simply from attacks on big government and bureaucracy). Outside of Moscow and Leningrad, which were bad enough, the Soviet Union was virtually a Third World country. One result today is that many who still admire Marxism and socialism have decided that it is virtuous to be poor, and that the ruined and miserable economy of a place like Cuba is a desirable "ecotopia" -- kinder to the environment than capitalism. This would be profoundly astonishing and mortifying to Karl Marx himself: the whole point about the evolution of communism is that it would be more productive and produce greater wealth for all than capitalism. A socialism that simply perpetuated poverty would be worthless -- a return, indeed, to what Marx called "oriental" despotism and a slave economy. Yet, as I have noted, it is the inevitable logical consequent of the denial of the existence of capital that the means of the development of greater production and greater wealth would themselves be destroyed. The fate of Marxist economies demonstrates this beyond a doubt.
Why this all happened goes back to the simplest principles of economics: it was Adam Smith, not Karl Marx, who understood the mechanism of history.
Gentlemen and the Working Class
Capitalism, the Free Market, and the Obligations of Property and Contract
The Museum of Communism
The Essential Anti-Communist Bibliography
The Post-Modern or "Leftover" Left
Burning Money, The Material Spirit of the Chinese Lifeworld, by C. Fred Blake, University of Hawai'i Press, 2011
History of Philosophy
"Human nature," "human psychology," and "false needs" are quotes from the ethics textbook I have used, Moral Reasoning, by Victor Grassian, p. 59. Grassian seriously misunderstands Marx, where human nature in an important sense doesn't even exist, and human psychology will be no more than a function of the "objective conditions" of production. The idea of "false needs" is not to be confused with "false consciousness," which is when someone who is not a member of an oppressor class is deceived into having the views of that class. Thus a wage laborer who believes in the free market is afflicted with "false consciousness." According to Marxism, such beliefs need not be credited or addressed on their own merits, which of course logically leads, as it did in historical fact, to a totalitarian dictatorship where the views of people are irrelevant next to the "scientific" knowledge of the dictators.
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Although communists liked to see fascism as the ultimate expression of capitalism, and fascism did nominally leave property in private hands, fascism and communism nevertheless had more in common with each other than with capitalism, since each was a collectivist ideology that subordinated individual interests to the purposes of the State. It was no coincidence that both Hitler and Mussolini came out of the socialist movement, and Lenin himself had praised Mussolini as the great champion of the Italian socialist party in the days before World War I. Later, Hitler's own best role model for ruthless police state power was Lenin. Both communists and fascists knew that the opposite of both ideologies was the despised "liberalism."
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