THE SOCIALIST MOVEMENT

NOTES ON MARXIANISM —AND AFTER

GREAT ECONOMIST'S ATTITUDE TO CAPITALISM

LECTURE TO WORKERS' EDUCATIONAL ASSOCIATION.

For his lecture to No. 1 class in economics (Workers' Educational Association), the Director of Tutorial Classes (Mr.. H. Heaton, M.A., M.Com.) spoke on Marxianism and the ideas which followed that philosophy. He said:—

Having outlined the salient features of Marxism, we may now comment upon the system as a whole, and examine critically some of its most important points, The whole system made claim to be scientific; it laid down certain economic laws, some of which governed all recorded history, whilst others applied only to modern capitalist society. But these laws were all-powerful; they worked and would work with the force and certainty of the laws of gravitation. Given certain conditions, certain results were inevitable. 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 85 years of the century all the harrowing titbits of working class sufferings.

But although capitalism had produced many evils, there is no real moral condemnation of it in Marx. All thoughts of idealism, all notions of justice, fair play, altruism, of 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 cannot come because it is a just form of society; it will come 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. In the Manifesto, the master class are patted on the back for the wonderful things they have achieved in the conquest of nature. They are almost thanked for having played "a most revolutionary part," and their efforts, although causing temporary suffering to the proletariat, are necessary preludes to the coming of Socialism. Hence there is no room for moral condemnation. The laborer gets full value for his labor power since he is paid as much as it costs to produce that power, and thus he is given a full price and robbed at the same time. Increasing misery, the destruction of the middle class, the concentration of capital, the recurrence of crises, all are described, but not condemned on ethical grounds. If capital is a vampire, which lives "by sucking living labor," well, it is the system which makes it so, and capital and labor alike are under the sway of inexorable economic laws.

Marxian Socialism was essentially a working-class gospel. The Utopian Socialists had welcomed men of all classes, and had sought to usher in their systems by converting 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, whilst 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.

Finally, Socialism would come as the result of a cataclysm and revolution. Not necessarily a revolution marked by barricades in the street, bloodshed, and the use of the guillotine, though Marx did not expect the bourgeoisie, even in England, to surrender without a fight of some sort. The revolution would perhaps be carried out by purely politic means, when the proletariat had secured control over the governing machine. In England this control might be obtained peacefully, at the ballot box, but in other countries where the suffrage was more narrow, or where Parliaments had not complete control over the Ministry, some manifestation of force might be necessary. Or the revolution might come as the result of a terrible and long-drawn out economic crisis in which the bourgeoisie, having smashed itself up and laid industry prostrate, would be willing or compelled to hand the means of production and exchange over to the workers, to see if they could do any better. But it would come —it was coming—in some form of another. It would come as the result of certain inevitable developments, due to the inherent character of capitalism and to the workings of "the economic law of motion of modern society." Given these developments, Socialism must come; until they were ripe and complete, it could not. "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 condition of their existence have matured within the old society." Let us therefore consider to what extent the necessary developments have gone on the lines laid down for them by Marx: but first let us consider the value of his preliminary propositions —the economic interpretation of history and the class struggle.

—The Economic Interpretation of History.—

This theory really contained two parts. In the first place the prevailing mode of economic production and exchange and the social organisation necessarily following from it, form the basis on which is built up and from which alone (note the word "alone") can be explained the political and intellectual history of the epoch. Secondly, all history has consequently been a series of class struggles. This was the crude form in which the theory was first formulated, and in this form it was generally accepted by Marxians. Wars, constitutions, codes of conduct. &c.. are explained by economic forces; economic man is the greater part if not the whole, of man; and to understand anything in history you must seek for the economic cause. In later years Engels denied that he and Marx had wished to rule out all other factors, but admitted that they were partly responsible for the fact that their followers had laid more stress on the economic side than it deserved. "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." Marx in 1852 admitted that "the traditions of all past generations weigh like a mountain upon tho brain of tho living." In his third volume he stated 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." Engels in 1894 conceded that whilst political, legal, philosophical, religious, literary, and artistic developments rested on the economic foundation, "they react upon each other and upon the economic basis." This is a very different story from the one told in the Manifesto and the earlier work of the two men. Modes of production and exchange, and the resultant social organisation, no longer provide the facts from which "alone" can be explained the political and intellectual conditions of an era, for these modes and that organisation can be reached upon and shaped by racial, legal, spiritual, and other factors. How then are we to decide which is cause and effect? How are we to measure the relative importance of material and spiritual forces? And even though primitive uneducated man was at the mercy of his material environment, the whole mental evolution since his day has gradually given us a greater control over that environment, and has subjected material forces to will and reason. Men no longer regard economic conditions and forces as unalterable; economics and ethics are becoming more and more knit together, and if men find some economic law working in a harmful manner they search round for some method of repealing or amending it. We no longer allow ourselves to be frightened away from any proposal of reform by the argument that it is "contrary to all the laws of political economy"; we claim power to alter social relationships if necessary, and if we do not go down to foundations we have the power to determine the architectural plan and details of the superstructure.

But even if we admit that historical events have their explanation in economic causes, it is far from easy to discover which economic force was really responsible. Engels furnished several instances of this difficulty. For instance, he describes the Reformation as being economic in cause, part of the struggle between the rising bourgeoisie and the old feudal system. Engels was right in saying that economic factors counted: but he did not hit upon the right factors. The same criticism may be made of Marx. In predicting the development of capitalism he picked out certain economic factors which were to determine that development; but he almost completely ignored such things as the growth of protective labor organisations, the growth of a social conscience and of State intervention, and the possibilities of co-operation. And yet all these forces were making themselves felt by 1867. One is tempted to suggest that both men put their finger only upon such economic forces as suited their case and supported their theory.

Having said all this, we may admit that the doctrine asserted so strongly by Marx is to a great extent true so far as earlier centuries are concerned, though it is becoming less true with the growth of mental powers. Marx did a great service to historical and economic study, and since his day no self-respecting historian has been able to ignore the play of economic forces in every century. History has had to be rewritten; economic history has become one of the most important branches of historical teaching, and floods of new light have been thrown on old problems. The modern historian has to show the interplay in economic, legal, political, racial, and spiritual forces, and he can no more ignore the economic factor than the Socialist can ignore the non-economic.

—The Class Struggle.—

The theory just discussed was not however to Marx and Engels an end in itself; it was a means to an end, and that end was the doctrine of the class struggle. History was the story of class struggles, and the classes were primarily economic in character. True, in the past there had been many classes; in the Middle Ages there were feudal lords, vassals, guild masters, journeymen, apprentices, serfs, and yeomen, and in almost all these classes there were sub-gradations. But in modern society this varied structure was being replaced by one much more simple, in which people were falling more and more "into two great hostile camps" directly facing each other. From many to two, and then with the coming of Socialism from two to one. Is this analysis psychologically, economically, or historically true? Are men's actions guided solely by their economic interests? For that is what the theory means in the long run. Rich and poor still persist in attending the same church; wage-earners who would not shed a drop of blood for the social revolution join hands with landlord and capitalist in giving their lives on the altar of patriotism; class-conscious social democrats, after nearly 50 years of Marxism, rally to protect themselves—and incidentally the bourgeoisie—against Czarism. In social and economic life we have a veritable babel of rivalries. The class struggle of Marx has its roots in the distribution of wealth, but there are scores of fights going on incessantly in the sphere of production. The agriculturist has potential or actual enemies not merely in his laborers, but also in the financier, the railroad authorities, the middleman, and those who want free importation of foodstuffs. The economic history of many lands in recent years is full of the battle between the rural producer who wants a tariff on food and free manufactured imports, and the manufacturer, who wants protection for his goods, but free importation of food. The importer is "up against" the local manufacturer, the borrower against the lender, the tenant against the landlord, the producer against the transporter, the retailer against the wholesaler. Firms compete with each other, however united they may be in fixing common prices or in opposing labor demands. Amongst the wage-earners, skilled look down on unskilled, clerks on manual workers, foremen on subordinates, white men on colored. And although the movement towards trade union solidarity had made much progress of recent years, supporters of one line of action have little tolerance for those who disagree. The Socialist has little affection for the Laborite, the syndicalist for the Socialist, the Marxian for the revisionist or Utopian. Social, religious, political, and national interests cut at right angles across the lines of economic cleavage. Meanwhile the big bulk of the wage-earning population jogs along, caring little for politics, seldom appearing at trade union meetings, worrying little about class-consciousness or the class struggle, holding no hopes of a heaven soon to come to earth, but quite satisfied if it can get a little more leisure, a little more pay, some degree of security of employment, and be left free to make the most of the world as it finds it. The entry of economic affairs into politics and the creation of a democratic franchise has tamed down the struggle between capital and labor to a thing of votes and political platforms; the results of State ownership have robbed Socialism of some of its radiant glamor; the strike, general or local, has proved to be a two-edged sword. Trade unionism, the strongest expression of class-consciousness, is not generally revolutionary in its aims, and except under stress of abnormal conditions is content with small gains here and there, seeking agreements rather than preaching aggression—defence not defiance. Thus to sum up, the class struggle between capital and labor is only one part of the general clash of ideas and interests in society. It has by no means concentrated mankind into two hostile economic camps; its chief manifestations are party politics and trade unionism, and neither of these has the revolutionary flavor necessary for the fulfilment of Marx's predictions.

—The Concentration of Production and Wealth.—

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 firm, employing its hundreds or thousands, is a common feature of industrial life to-day. The trust movement has brought scores of establishments under central control, though this is not so much due to advantages in production as to tho desire to eliminate competition. But whilst the big firms have grown in size and number, the middle-sized and smalls ones are far from being crushed out of existence. Instead, they tend to 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 nevertheless they persist in multiplying. In them the personal interest and alertness of the owner-manager compensates to some extent for the loss of the economics of large-scale production; and it is probable that those economies may diminish as big concerns get too big to manage, and so sink into routine methods. Thus the large unit is far from covering the whole or even half of the industrial field. In agriculture Marx's prediction as to concentration was completely falsified. Arguing from his knowledge of English conditions, where the small farmer had largely disappeared, Marx expected similar results everywhere else. He had no sympathy with the peasant proprietor; he described small-scale farming as "worthless and wholly irrational," and in the Manifesto declared that capitalism "would rescue a considerable part of the population from the idiocy of country life." In "Capital" he stated that modern industry would have a greater effect in agriculture than elsewhere, because it would annihilate the peasant, that bulwark of the old society, and replace him by the wage-earner. Liebknecht followed the same idea when he said that the steam plough would do for agriculture what the steam engine had done for industry, while Engels in 1895 declared that large-scale production would run down the peasantry just as a railway train would run down a wheelbarrow. In all this the wish was father to the thought, for not only could there be no social revolution so long as the ownership of land was widely scattered, but Marx knew that the small land owners would be the most dangerous enemies of Socialism. Therefore, let them be crushed; it will be unpleasant, but good for the development of the class antagonism essential to the success of the class struggle. Marx knew very little about farming; therefore he did not realise 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 fertilisers careful breeding, hoeing, pruning, irrigating, &c., all can be availed of by the small man almost as well as the big one. Personal interest, training, and attention count quite as much as machines in some occupations. 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 is true not merely of old lands, where many big estates have been subdivided, but also of new countries. In Canada and the United States the average farm is about 146 acres, but as intensive culture is adopted the area will probably diminish. Cultivation and ownership go together in the great bulk of these small farms. (See lecture 3.) 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 reach independence: it ceases to be a terror. . . . credit banks. Co-operation can dispense with privately owned storehouses factories, and domineering middlemen: private ownership of railways is confined to very few countries, and is generally recognised as doomed, whilst co-operation or State ownership can reduce the shipping freight question to smaller dimensions. Thus the world's biggest industry stands almost untouched by large-scale capitalistic methods. The wheelbarrow moves on, but the railway train is stuck some where down the line. And the wheel barrow refuses to accept a coat of red paint.

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. Here again he was unfortunate. The joint stock limited liability idea was beyond the stage of infancy when he wrote, but he failed to see its possibilities. Individual ownership of the capital of a big firm is very rare, and so whilst there may be great concentration in production there may be, and is, great diffusion of ownership. The firm of Lipton some years ago had 74,000 shareholders; the United States railway shams in 1900 were in the hands of 350,000 people, and is 1912 in those of 500,000. The United States Steel Corporation in 1912 was the property of 110,000, and the total number of share-holders in the U.S.A. in 1912 was about 2,000,000. When we add to this the millions of landowners, large and small, the Carnegies become surrounded by a strong triple guard, ranging from the owner of a suburban allotment right through all the grades of the middle class up to the precincts of Wall Street and Skibo Castle. For the middle class has no more vanished than the peasant proprietor. Income tax returns, the existence of middle class suburbs, the number of moderately priced motor cars, &c., all bear witness to the fact. The middle class thrives either on successful small or medium-sized businesses, the greatly expanded professions, or on the shares which it holds in big concerns. It is reinforced daily by the men who work up into it from amongst the wage-earners. Here again, then, the Marxian programme seems to have broken down. As Kautsky said in 1896, "If capitalists are on the increase, and not the propertyless, then the development is setting us back further and further from our goal; then capitalism entrenches itself, and not Socialism: then our hopes will never materialise." The nearer we get to the day of expropriation, the more numerous grow the enemy.

—Increasing Misery.—

Accumulation of wealth at one pole was to be accompanied by accumulating misery, agony of toil, slavery, brutality, and mental degradation at the other pole. The laborer was to sink deeper and deeper, become a pauper. Such conditions would eventually stir the organised workers to take things into their own hands. Marx based this prediction partly on the economic conditions of 1800-1850. but also on the assumption of free competition, no State intervention, with a surplus labor supply at hand, making resistance by the workers useless. But by 1867 trade unionism was checking free competition, stiffening the courage of the industrial reserve army and fighting for better conditions. Factory legislation had already done much for women and children, and the blessings of free competition were being everywhere challenged. And yet Marx virtually ignores these new tendencies; instead he predicts iron laws at work turning out magnates and miserables. Again time has proved Marx a poor prophet. Real wages, in almost every country increased 50 to 100 per. cent, between 1850 and 1900. Wages went up even when prices were falling heavily (1873-1896). but have failed to keep pace with the world rise in prices since 1896. The increase has made the standard of living much higher than 50 years ago. Necessaries to-day were luxuries then. Education and leisure have opened up new avenues of enjoyment. The rich have got richer, but the poor are not poorer. To this the Marxian apologist, says that Marx meant relative misery: the rich have gone ahead more rapidly than the poor, and have got more than their share. But this is twisting Marx's whole language and theory. He meant actual, not relative misery; his whole theory of accumulation, industrial reserve army, wages. &c. supported the thesis. And he was wrong.

The misery was to be accentuated by the periodical crises which prostrated the capitalist system. These crises were going to be more and more severe, and recovery from them more slow, until, perhaps, finally one of them, more severe than the rest would ring the death knell of the system. Unfortunately ever since 1867 industrial fluctuations in Great Britain have become much less violent in inception and character. There has been no great financial collapse to act as prelude, and the conditions during the slack years have been much less harsh than in the depressions of earlier decades. Crises and depressions have tamed down instead of getting wilder. The growth of the international market, improvements in transport, the sense of solidarity among financial houses, the restriction of competition by trusts and kartels, all these, as Engels admitted in 1894 have eliminated or strongly reduced the "old breeding grounds of crises and opportunities for the growth of crises." And so capitalism takes another lease of life.

And the social revolution? When will it come? There can be no doubt that Marx for a long time believed that capital-ism would work itself out quickly, and so give place to Socialism within a few decades. With the fervor of an enthusiast he believed every sign to be the real one. Revolution was coming in 1848; as a result of the Crimean; with the Commune of Paris, and probably many other times as well. This belief in an early day of judgment was widespread. During the long depression of the eighties, Engels declared that he could almost calculate the moment when the unemployed, losing patience, would take their own fate into their own hands; the International Socialist Congress in 1896 was convinced that a great commercial crisis was at hand, and therefore impressed upon the proletariat of all countries the imperative necessity for learning, as class-conscious citizens, how to administer the business of their respective countries for the common good.

—Conclusion.—

We can now sum up our criticism of Marxian Socialism. That Socialism does not depend upon the theory of value, but upon the fulfilment of certain specified historical developments. We have seen that there is little sign of these developments working out as Marx predicted. There is no such inevitability in any human institution as Marx postulated. Men will not succumb to any force with out a struggle, and the chief failing of Marx was that he forgot to allow for counter-tendencies. Capitalists, especially those who read Marx, gradually began to see that competition was a mixed blessing; so they combated it. They sought for the causes of commercial crises, and finding them partly financial, took steps to guard against any subsequent monetary collapse. And the workmen, instead of being the passive victims of capitalism, soon began to organise in defence. Hence each section takes steps to protect its life and interests. This makes it impossible to prophecy the line of development. History is strewn with false prophecies: the prophets underestimate the force of some factors, place too much stress on others, omit to allow for the unexpected, and let their wishes shape their forecasts. All this applies to Marx. He wrote whilst capitalism was really in its infancy, when the transition from old to new forms was still incomplete, and when, therefore, men had scarcely begun to face the problems created by the new economic order. The wonder was not that in places he was wrong, but that in others he was so nearly right. Still, if Socialism can only come when all the necessary developments of concentration, class division, misery, and economic stagnation are fully grown, the social revolution is still a long way off. To what extent the necessary conditions may be created after the war one cannot say, for scores of prophecies made by experts during the last four years have been proved false. But Socialism will have to get back from the conception of economic inevitability to one of social justice. It will have to cease saying "Socialism is the next economic order" and say once more "Socialism is the embodiment of a higher ethical code, and the realisation of an ideal of economic justice. It must come, not because it has got to come, but because it ought to come. Exploitation must go because it is robbery; private appropriation must go because it injures the social well-being; extremes of wealth and poverty must vanish because they are morally unhealthy for rich and poor alike. Socialism must be the victory of mind over matter, of ideals over economics, of justice over selfishness. But that means "utopia-mongering."

—Books Recommended.—
As in previous lectures.

Simkhovitch, "Marxism versus Socialism."

Skelton, "Socialism, a Critical Analysis."

Bernstein, "Evolutionary Socialism."

Vandervelde, "Collectivism and Industrial Revolution."

Daily Herald (Adelaide, SA : 1910 - 1924), Wednesday 10 July 1918, page 2