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By Sean McElwee

There's a lot of talk of Karl Marx in the air these days – from Rush Limbaugh (Tman) ( accusing Pope Francis of promoting "pure Marxism" to a Washington Times writer (AZ) claiming that New York City Mayor Bill de Blasio is an "unrepentant Marxist." But few people (Conks) actually understand Marx's trenchant critique of capitalism. Most people are vaguely aware of the radical economist's prediction that capitalism would inevitably be replaced by communism, but they often misunderstand why he believed this to be true. And while Marx was wrong about some things, his writings (many of which pre-date the American Civil War) accurately predicted several aspects of contemporary capitalism, from the Great Recession to the iPhone 5S in your pocket.

Here are five facts of life in 2014 that Marx's analysis of capitalism correctly predicted more than a century ago:

1. The Great Recession (Capitalism's Chaotic Nature)

The inherently chaotic, crisis-prone nature of capitalism was a key part of Marx's writings. He argued that the relentless drive for profits would lead companies to mechanize their workplaces, producing more and more goods while squeezing workers' wages until they could no longer purchase the products they created. Sure enough, modern historical events from the Great Depression to the dot-com bubble can be traced back to what Marx termed "fictitious capital" – financial instruments like stocks and credit-default swaps. We produce and produce until there is simply no one left to purchase our goods, no new markets, no new debts. The cycle is still playing out before our eyes: Broadly speaking, it's what made the housing market crash in 2008. Decades of deepening inequality reduced incomes, which led more and more Americans to take on debt. When there were no subprime borrows left to scheme, the whole façade fell apart, just as Marx knew it would.

2. The iPhone 5S (Imaginary Appetites)

Marx warned that capitalism's tendency to concentrate high value on essentially arbitrary products would, over time, lead to what he called "a contriving and ever-calculating subservience to inhuman, sophisticated, unnatural and imaginary appetites." It's a harsh but accurate way of describing contemporary America, where we enjoy incredible luxury and yet are driven by a constant need for more and more stuff to buy. Consider the iPhone 5S you may own. Is it really that much better than the iPhone 5 you had last year, or the iPhone 4S a year before that? Is it a real need, or an invented one? While Chinese families fall sick with cancer from our e-waste, megacorporations are creating entire advertising campaigns around the idea that we should destroy perfectly good products for no reason. If Marx could see this kind of thing, he'd nod in recognition.

3. The IMF (The Globalization of Capitalism)

Marx's ideas about overproduction led him to predict what is now called globalization – the spread of capitalism across the planet in search of new markets. "The need of a constantly expanding market for its products chases the bourgeoisie over the entire surface of the globe," he wrote. "It must nestle everywhere, settle everywhere, establish connections everywhere." While this may seem like an obvious point now, Marx wrote those words in 1848, when globalization was over a century away. And he wasn't just right about what ended up happening in the late 20th century – he was right about why it happened: The relentless search for new markets and cheap labor, as well as the incessant demand for more natural resources, are beasts that demand constant feeding.

4. Walmart (Monopoly)

The classical theory of economics assumed that competition was natural and therefore self-sustaining. Marx, however, argued that market power would actually be centralized in large monopoly firms as businesses increasingly preyed upon each other. This might have struck his 19th-century readers as odd: As Richard Hofstadter writes, "Americans came to take it for granted that property would be widely diffused, that economic and political power would decentralized." It was only later, in the 20th century, that the trend Marx foresaw began to accelerate. Today, mom-and-pop shops have been replaced by monolithic big-box stores like Walmart, small community banks have been replaced by global banks like J.P. Morgan Chase and small famers have been replaced by the likes of Archer Daniels Midland. The tech world, too, is already becoming centralized, with big corporations sucking up start-ups as fast as they can. Politicians give lip service to what minimal small-business lobby remains and prosecute the most violent of antitrust abuses – but for the most part, we know big business is here to stay.

5. Low Wages, Big Profits (The Reserve Army of Industrial Labor)

Marx believed that wages would be held down by a "reserve army of labor," which he explained simply using classical economic techniques: Capitalists wish to pay as little as possible for labor, and this is easiest to do when there are too many workers floating around. Thus, after a recession, using a Marxist analysis, we would predict that high unemployment would keep wages stagnant as profits soared, because workers are too scared of unemployment to quit their terrible, exploitative jobs. And what do you know? No less an authority than the Wall Street Journal warns, "Lately, the U.S. recovery has been displaying some Marxian traits. Corporate profits are on a tear, and rising productivity has allowed companies to grow without doing much to reduce the vast ranks of the unemployed." That's because workers are terrified to leave their jobs and therefore lack bargaining power. It's no surprise that the best time for equitable growth is during times of "full employment," when unemployment is low and workers can threaten to take another job.

In Conclusion:

Marx was wrong about many things. Most of his writing focuses on a critique of capitalism rather than a proposal of what to replace it with – which left it open to misinterpretation by madmen like Stalin in the 20th century. But his work still shapes our world in a positive way as well. When he argued for a progressive income tax in the Communist Manifesto, no country had one. Now, there is scarcely a country without a progressive income tax, and it's one small way that the U.S. tries to fight income inequality. Marx's moral critique of capitalism and his keen insights into its inner workings and historical context are still worth paying attention to. As Robert L. Heilbroner writes, "We turn to Marx, therefore, not because he is infallible, but because he is inescapable." Today, in a world of both unheard-of wealth and abject poverty, where the richest 85 people have more wealth than the poorest 3 billion, the famous cry, "Workers of the world unite; you have nothing to lose but your chains," has yet to lose its potency.

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OL FU wrote:So which successful country operates under a Marxist system

I know you're just yanking chains

Most of his writing focuses on a critique of capitalism rather than a proposal of what to replace it with – which left it open to misinterpretation by madmen like Stalin in the 20th century.

D1B wrote:The ethical foundation and principals of the Catholic Church and Christianity are identical to many key Marxist principals.

89Hen wrote:

D1B wrote:The ethical foundation and principals of the Catholic Church and Christianity are identical to many key Marxist principals.

That's rich coming from you.

D1B wrote:

89Hen wrote: That's rich coming from you.

Why?

89Hen wrote:

D1B wrote:
Why?

Because you used them as an example of successfully operating.

D1B wrote:

OL FU wrote:So which successful country operates under a Marxist system

I know you're just yanking chains

Key Marxist economic theories have been employed by the most successful of nations in Northern Europe and the United States of America, to name a few. The ethical foundation and principals of the Catholic Church and Christianity are identical to many key Marxist theories.

That being said, this thread concerns only his economic theories and predictions. Go ahead and start another thread regarding countries operating under a Marxist "system," what ever that is. Lots of countries claim to be or are labeled by conks as Marxist, but as the article states, they're really based on misinterpretations, most with disastrous results.

Most of his writing focuses on a critique of capitalism rather than a proposal of what to replace it with – which left it open to misinterpretation by madmen like Stalin in the 20th century.

D1B wrote:

89Hen wrote: Because you used them as an example of successfully operating.

No, I didn't. I said their ethical principals are essentially Marxist. These principals are the only good thing about the Church.

89Hen wrote:

D1B wrote:
No, I didn't. I said their ethical principals are essentially Marxist. These principals are the only good thing about the Church.

OK Myron.

D1B wrote:

89Hen wrote: OK Myron.

Hen = another catholic who don't know shit about Jesus.

OL FU wrote:

D1B wrote:
Key Marxist economic theories have been employed by the most successful of nations in Northern Europe and the United States of America, to name a few. The ethical foundation and principals of the Catholic Church and Christianity are identical to many key Marxist theories.

That being said, this thread concerns only his economic theories and predictions. Go ahead and start another thread regarding countries operating under a Marxist "system," what ever that is. Lots of countries claim to be or are labeled by conks as Marxist, but as the article states, they're really based on misinterpretations, most with disastrous results.

Look it has been a long time since I read Marx but the solutions don't work because Marx solution was a utopian worker paradise that is impossible to create. So the reason there are no successful Marxist countries is because Marx's solutions were not workable in any realistic way. For the guy to state that Marx was short on solutions means he read only the parts of Marx that he wanted to. Besides if you look at the examples the guy gave, he not only didn't understand Marx in totality, he doesn't understand economic history or modern realities.

89Hen wrote:

D1B wrote:
Why?

Because you used them as an example of successfully operating.

OL FU wrote:Here is the problem. You can't pretend that Marx was the first socialist. You can say he differed significantly from other socialist who didn't believe that the entirety of the status quo had to be eliminated. Some favored revolution, some working to goals to improve society, etc. Marx thought they were their methods would never work. So he advocated and predicted revolution, the dictatorship of the proletariat and ultimately communism where the workers worked for the common good. We can argue all day long about the benefit or detriment of the other socialists but we can't argue that the civilized world is much better off today than in 1848 and a lot of that can be attributed to the adoption of those more moderate socialist ideas. (well some people will argue it). So what we know today is those more moderate socialist were much closer to being right and Marx ideas failed.

89Hen wrote:

D1B wrote:
Hen = another catholic who don't know shit about Jesus.

DB1 = a lost soul that I pray for regularly.

andy7171 wrote:

89Hen wrote: Because you used them as an example of successfully operating.

Boom

OL FU wrote:Here is the problem. You can't pretend that Marx was the first socialist. You can say he differed significantly from other socialist who didn't believe that the entirety of the status quo had to be eliminated. Some favored revolution, some working to goals to improve society, etc. Marx thought they were their methods would never work. So he advocated and predicted revolution, the dictatorship of the proletariat and ultimately communism where the workers worked for the common good. We can argue all day long about the benefit or detriment of the other socialists but we can't argue that the civilized world is much better off today than in 1848 and a lot of that can be attributed to the adoption of those more moderate socialist ideas. (well some people will argue it). So what we know today is those more moderate socialist were much closer to being right and Marx ideas failed.

JoltinJoe wrote:

OL FU wrote:Here is the problem. You can't pretend that Marx was the first socialist. You can say he differed significantly from other socialist who didn't believe that the entirety of the status quo had to be eliminated. Some favored revolution, some working to goals to improve society, etc. Marx thought they were their methods would never work. So he advocated and predicted revolution, the dictatorship of the proletariat and ultimately communism where the workers worked for the common good. We can argue all day long about the benefit or detriment of the other socialists but we can't argue that the civilized world is much better off today than in 1848 and a lot of that can be attributed to the adoption of those more moderate socialist ideas. (well some people will argue it). So what we know today is those more moderate socialist were much closer to being right and Marx ideas failed.

Marx's call for revolution was not necessarily a call for violent revolution. True, he did advocate a violent overthrow of the capitalist class in the Communist Manifesto, but in later writings he acknowledged that the proletariat might take control of the means of production in a non-violent fashion at least in some states (citing America, for example, due to its democratic features).

"Marxists" have continued to be identified as violent revolutionists because, well, most of them are.

kalm wrote:

JoltinJoe wrote:
Marx's call for revolution was not necessarily a call for violent revolution. True, he did advocate a violent overthrow of the capitalist class in the Communist Manifesto, but in later writings he acknowledged that the proletariat might take control of the means of production in a non-violent fashion at least in some states (citing America, for example, due to its democratic features).

"Marxists" have continued to be identified as violent revolutionists because, well, most of them are.

Strong work in this thread Joe.