Marx's Capital - making sense of globalisation

There is a growing awareness that the recent period of globalisation is the source of the climate change now threatening life on the planet.

There are some like the protester in this picture who attribute the problems to capitalism.

A World to Win:

• shows not just how and why the recent period of capitalist globalisation has developed and is engulfing the world in multi-dimensional crises,
• but discovers within it the potential for replacing capitalism.
• This potential arises as an opposite to the interconnected web of global corporations, and the economic and political structures which do their bidding.

The need to explore and inhabit all parts of the planet has always been a feature of human development.

Marx showed how the unfolding of history reflects the changing relationship between the tools, materials, and technologies developed for production and the ownership of them by different social classes.

Although writing in England, in the middle of the nineteenth century, in the wake of the industrial revolution, Marx’s work provides us with the means to continue his analysis and to make sense of the recent period of capitalist globalisation which began in the 1970s.

As Francis Wheen concludes in his 2006 biography of Marx’s Das Kapital:

‘While all that is solid still melts into air, Das Kapital’s vivid portrayal of the forces that govern our lives – and of the instability, alienation and exploitation they produce – will never lose its resonance, or its power to bring the world into focus.’

Famously, Marx adopted Hegel’s science of logic, his dialectic, which shows that development takes place through the working out of the struggle between contradictory opposites ( the unity, conflict, interpenetration and transformation of opposites).

But Marx rejected Hegel’s view that the changes taking place in the world were the product of the mind of God.

Marx turned Hegel’s idealist dialectics right-side up.

Marx argued that the laws governing the contradictory development of nature, which evolved into human society and its thought processes are reflected in the mind.

Thought reflects the movement of matter rather than the other way round.

The everyday experience of the struggle for survival leads to scientific study which discovers these laws and enables us to intervene and change the world.

Das Kapital was intended as a means for workers to understand the development of the exploitative society which had come to dominate their lives by turning everything into a commodity, and to equip them with the means to change it.

Ironically, Das Kapital, the book intended to oppose and help replace the increasing dominance of the commodity, is now on sale cheaply at Wal-Mart, the world’s largest corporation, and the one which deals in the widest variety of commodities.

That Das Kapital has itself become so widely available, is further proof of the correctness of Marx’s assertion that Capital creates the potential for its own replacement.

This assessment is adapted from an 1872 critical review of Das Kapital which appeared in the St Petersburg European Messenger.

It emphasises Marx’s discovery not just of the temporary nature of capitalist society, but of the laws which govern its birth, development, and replacement.

The early stages of analysis examine the contradictory opposites which comprise an object or process.

Marx’s method of analysis begins by breaking a whole into its parts, and examining both the characteristics of each of the parts, and the relationships between the parts.

Lenin’s article On the Question of Dialectics was written in 1915 and appears in his Philosophical Notebooks. This was theoretical work he was doing to prepare the forces who were to lead the revolution in 1917.

Lenin's Collected Works Vol. 38 pp 221 - 222: Summary of Dialectics

Even more than in Marx’s day, the social act of selling and buying commodities is ‘the simplest, most ordinary and fundamental, most common and everyday relation’, as Lenin put it.

Everything we do is either directly concerned with or influenced by it in some way.

The advent of Ebay is just one example of the extent to which the world market that Marx examined has developed.

The insistent demands of the marketing arms of the global corporations build to a crescendo and impact on every aspect of our lives.

Marx showed how capitalist production of commodities arose out of the preceding five thousand years of production in which goods produced for exchange in the marketplace were only a small proportion of what was produced for local consumption.

The goods exchanged were surplus to local needs.

So the producer had no use for the surplus which was offered to others in the marketplace in exchange for something else.

Capitalism changed the emphasis from the production of useful objects – their value in use was the key, the properties that an object has that fulfils some useful purpose - to an interest solely in their value in exchange, measured in the amount of money they can command. This exchange-value measures the amount of human labour required for production of the commodity

The main purpose of production shifted from production for need to production for exchange, and to the profit which could be made in the process.

Marx proved that the expansion of value which is the source of profit cannot be derived just from the process of exchange of equivalents in the market-place.

So to discover more about the production of value and profit it was necessary to go behind the appearance of commodity exchange to study the process of capitalist production which lies hidden behind it.

Here, in the world of capitalist production the owner who has accumulated value in the form of capital uses his power to employ labour – people who own nothing other than their ability to work.

The single objective in the mind of the capitalist is the generation of profit.

This has become a legal requirement governing the contradictory relation between capital and labour.

The employment contract ensures that the employees continue working – supplying their ability to work (labour power) - beyond the time necessary to produce the value of their own wages.

In the additional period surplus labour is supplied to the employer for no pay.

The surplus value generated by this surplus labour is the source of profit.

Part of the profit is needed to expand the capital, and part is distributed to shareholders.

Bill Gates, the richest man in the world, has acquired his wealth as a result of the fact that in capitalist society the products of labour belong to the capitalist employer.

Like all workers, the programmers he employs have no say over the products they produce, nor any right to the revenue generated by their sale, other than the price of the commodity they sell to him . This price is the wages or salaries paid in exchange for the use of their labour-power for the period of time stated in the employment contract..

Bill has the sole right to determine what happens to Windows and the other Microsoft products once they have been produced.

It’s why he smiles so much.

When a particular commodity is generating profit, other producers join the industry as competitors for the profit.

Competition forces attempts to reduce the cost of production including the cost of employing workers.

This in turn leads to increased investment in fixed capital, reducing the proportion of workers employed and ...

... Marx’s discovery - that the contradictory social relation between capital and labour inevitably produces a tendency for the rate of profit to decline, and equally inevitable attempts to overcome it.

This is fundamental to our understanding of the dynamic that drives capitalist globalisation.

It tells us that no amount of regulation whether nationally or globally can hold back the opposite tendency to ...

Growth (measured by Gross Domestic Product for each country) measures the value of commodities produced, which includes the expansion of capital.

As growth is the production of increasing quantities of commodities, at a certain point the level of production reaches and exceeds the limits of the market for these commodities.

The expansion of credit (and its opposite – debt) allows consumers to keep buying, and so extends the limits, until the limits of credit are themselves reached and unrepayable debt produces bankruptcy on a mass scale.

The consequent financial crisis produces a slump in production and the need to eliminate surplus capacity by plant closures, and physical destruction of factories and infrastructure as well as millions of surplus workers.

Following destruction, new sources of credit (which Marx called fictitious capital) restart the boom and bust spiral.

Each of these ingredients has been developed within capitalism. In this list we see some of the components which make a different kind of society both possible and necessary.

Many have been necessary for its continued ability to extract profit from the use of the employment contract.

Globalisation has drawn more than 3 billion people into employment in recent years. These are the people who Marx called the gravediggers of capitalism who it produces as its own opposite.

Capitalism and its most recent phase of globalisation has also produced many not-for-profit social and economic activities which attempt to take the edge off its worst effects.

They have established many ways of collective, cooperative working together which can be taken forward as the basis for a new participatory democracy.